Correlation Between Polygiene and G5 Entertainment
Can any of the company-specific risk be diversified away by investing in both Polygiene and G5 Entertainment 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 Polygiene and G5 Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polygiene AB and G5 Entertainment publ, you can compare the effects of market volatilities on Polygiene and G5 Entertainment 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 Polygiene with a short position of G5 Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polygiene and G5 Entertainment.
Diversification Opportunities for Polygiene and G5 Entertainment
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Polygiene and G5EN is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Polygiene AB and G5 Entertainment publ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G5 Entertainment publ and Polygiene 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 Polygiene AB are associated (or correlated) with G5 Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G5 Entertainment publ has no effect on the direction of Polygiene i.e., Polygiene and G5 Entertainment go up and down completely randomly.
Pair Corralation between Polygiene and G5 Entertainment
Assuming the 90 days trading horizon Polygiene AB is expected to generate 1.8 times more return on investment than G5 Entertainment. However, Polygiene is 1.8 times more volatile than G5 Entertainment publ. It trades about 0.2 of its potential returns per unit of risk. G5 Entertainment publ is currently generating about 0.17 per unit of risk. If you would invest 1,080 in Polygiene AB on August 27, 2024 and sell it today you would earn a total of 220.00 from holding Polygiene AB or generate 20.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polygiene AB vs. G5 Entertainment publ
Performance |
| Timeline |
| Polygiene AB |
| G5 Entertainment publ |
Polygiene and G5 Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polygiene and G5 Entertainment
The main advantage of trading using opposite Polygiene and G5 Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polygiene position performs unexpectedly, G5 Entertainment 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 G5 Entertainment will offset losses from the drop in G5 Entertainment's long position.| Polygiene vs. SaltX Technology Holding | Polygiene vs. Nexam Chemical Holding | Polygiene vs. AAC Clyde Space | Polygiene vs. KABE Group AB |
| G5 Entertainment vs. Alfa Laval AB | G5 Entertainment vs. Anoto Group AB | G5 Entertainment vs. Active Biotech AB | G5 Entertainment vs. BioInvent International AB |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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