Correlation Between Predictive Discovery and Gtn
Can any of the company-specific risk be diversified away by investing in both Predictive Discovery and Gtn 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 Predictive Discovery and Gtn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Predictive Discovery and Gtn, you can compare the effects of market volatilities on Predictive Discovery and Gtn 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 Predictive Discovery with a short position of Gtn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Predictive Discovery and Gtn.
Diversification Opportunities for Predictive Discovery and Gtn
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Predictive and Gtn is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Predictive Discovery and Gtn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gtn and Predictive Discovery 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 Predictive Discovery are associated (or correlated) with Gtn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gtn has no effect on the direction of Predictive Discovery i.e., Predictive Discovery and Gtn go up and down completely randomly.
Pair Corralation between Predictive Discovery and Gtn
Assuming the 90 days trading horizon Predictive Discovery is expected to under-perform the Gtn. But the stock apears to be less risky and, when comparing its historical volatility, Predictive Discovery is 1.56 times less risky than Gtn. The stock trades about -0.14 of its potential returns per unit of risk. The Gtn is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Gtn on September 12, 2024 and sell it today you would earn a total of 10.00 from holding Gtn or generate 21.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Predictive Discovery vs. Gtn
Performance |
| Timeline |
| Predictive Discovery |
| Gtn |
Predictive Discovery and Gtn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Predictive Discovery and Gtn
The main advantage of trading using opposite Predictive Discovery and Gtn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Predictive Discovery position performs unexpectedly, Gtn 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 Gtn will offset losses from the drop in Gtn's long position.| Predictive Discovery vs. Clime Investment Management | Predictive Discovery vs. Regal Funds Management | Predictive Discovery vs. Retail Food Group | Predictive Discovery vs. Health and Plant |
| Gtn vs. Insignia Financial | Gtn vs. Oceania Healthcare | Gtn vs. Perpetual Credit Income | Gtn vs. Capitol Health |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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