Correlation Between PGAL and CHII
Can any of the company-specific risk be diversified away by investing in both PGAL and CHII 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 PGAL and CHII into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PGAL and CHII, you can compare the effects of market volatilities on PGAL and CHII 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 PGAL with a short position of CHII. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGAL and CHII.
Diversification Opportunities for PGAL and CHII
Very weak diversification
The 3 months correlation between PGAL and CHII is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding PGAL and CHII in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHII and PGAL 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 PGAL are associated (or correlated) with CHII. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHII has no effect on the direction of PGAL i.e., PGAL and CHII go up and down completely randomly.
Pair Corralation between PGAL and CHII
If you would invest 1,224 in CHII on September 4, 2024 and sell it today you would earn a total of 0.00 from holding CHII or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PGAL vs. CHII
Performance |
| Timeline |
| PGAL |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| CHII |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PGAL and CHII Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PGAL and CHII
The main advantage of trading using opposite PGAL and CHII positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PGAL position performs unexpectedly, CHII 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 CHII will offset losses from the drop in CHII's long position.| PGAL vs. iShares MSCI Ireland | PGAL vs. Global X MSCI | PGAL vs. iShares MSCI Finland | PGAL vs. Global X MSCI |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |