Correlation Between GMO Internet and Easy Software
Can any of the company-specific risk be diversified away by investing in both GMO Internet and Easy Software at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GMO Internet and Easy Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GMO Internet and Easy Software AG, you can compare the effects of market volatilities on GMO Internet and Easy Software and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GMO Internet with a short position of Easy Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMO Internet and Easy Software.
Diversification Opportunities for GMO Internet and Easy Software
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GMO and Easy is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding GMO Internet and Easy Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easy Software AG and GMO Internet is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GMO Internet are associated (or correlated) with Easy Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easy Software AG has no effect on the direction of GMO Internet i.e., GMO Internet and Easy Software go up and down completely randomly.
Pair Corralation between GMO Internet and Easy Software
Assuming the 90 days horizon GMO Internet is expected to generate 0.34 times more return on investment than Easy Software. However, GMO Internet is 2.97 times less risky than Easy Software. It trades about 0.06 of its potential returns per unit of risk. Easy Software AG is currently generating about -0.08 per unit of risk. If you would invest 1,600 in GMO Internet on October 29, 2024 and sell it today you would earn a total of 20.00 from holding GMO Internet or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GMO Internet vs. Easy Software AG
Performance |
| Timeline |
| GMO Internet |
| Easy Software AG |
GMO Internet and Easy Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMO Internet and Easy Software
The main advantage of trading using opposite GMO Internet and Easy Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMO Internet position performs unexpectedly, Easy Software can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Easy Software will offset losses from the drop in Easy Software's long position.| GMO Internet vs. Yuexiu Transport Infrastructure | GMO Internet vs. BROADWIND ENRGY | GMO Internet vs. Hanison Construction Holdings | GMO Internet vs. Gold Road Resources |
| Easy Software vs. Air Transport Services | Easy Software vs. Reinsurance Group of | Easy Software vs. Osisko Metals | Easy Software vs. VIENNA INSURANCE GR |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |