Correlation Between GEE and Insperity
Can any of the company-specific risk be diversified away by investing in both GEE and Insperity 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 GEE and Insperity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEE Group and Insperity, you can compare the effects of market volatilities on GEE and Insperity 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 GEE with a short position of Insperity. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEE and Insperity.
Diversification Opportunities for GEE and Insperity
Weak diversification
The 3 months correlation between GEE and Insperity is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding GEE Group and Insperity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insperity and GEE 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 GEE Group are associated (or correlated) with Insperity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insperity has no effect on the direction of GEE i.e., GEE and Insperity go up and down completely randomly.
Pair Corralation between GEE and Insperity
Considering the 90-day investment horizon GEE Group is expected to under-perform the Insperity. In addition to that, GEE is 1.58 times more volatile than Insperity. It trades about -0.05 of its total potential returns per unit of risk. Insperity is currently generating about -0.02 per unit of volatility. If you would invest 11,159 in Insperity on August 30, 2024 and sell it today you would lose (3,314) from holding Insperity or give up 29.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEE Group vs. Insperity
Performance |
| Timeline |
| GEE Group |
| Insperity |
GEE and Insperity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEE and Insperity
The main advantage of trading using opposite GEE and Insperity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEE position performs unexpectedly, Insperity 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 Insperity will offset losses from the drop in Insperity's long position.The idea behind GEE Group and Insperity pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Insperity vs. Korn Ferry | Insperity vs. Barrett Business Services | Insperity vs. TrueBlue | Insperity vs. Heidrick Struggles International |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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