Correlation Between Priority Technology and Global Blue
Can any of the company-specific risk be diversified away by investing in both Priority Technology and Global Blue 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 Priority Technology and Global Blue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Priority Technology Holdings and Global Blue Group, you can compare the effects of market volatilities on Priority Technology and Global Blue 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 Priority Technology with a short position of Global Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Priority Technology and Global Blue.
Diversification Opportunities for Priority Technology and Global Blue
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Priority and Global is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Priority Technology Holdings and Global Blue Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and Priority Technology 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 Priority Technology Holdings are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of Priority Technology i.e., Priority Technology and Global Blue go up and down completely randomly.
Pair Corralation between Priority Technology and Global Blue
Given the investment horizon of 90 days Priority Technology is expected to generate 7.5 times less return on investment than Global Blue. In addition to that, Priority Technology is 2.47 times more volatile than Global Blue Group. It trades about 0.01 of its total potential returns per unit of risk. Global Blue Group is currently generating about 0.28 per unit of volatility. If you would invest 550.00 in Global Blue Group on November 2, 2024 and sell it today you would earn a total of 157.00 from holding Global Blue Group or generate 28.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Priority Technology Holdings vs. Global Blue Group
Performance |
| Timeline |
| Priority Technology |
| Global Blue Group |
Priority Technology and Global Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Priority Technology and Global Blue
The main advantage of trading using opposite Priority Technology and Global Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Priority Technology position performs unexpectedly, Global Blue 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 Global Blue will offset losses from the drop in Global Blue's long position.| Priority Technology vs. Lesaka Technologies | Priority Technology vs. CSG Systems International | Priority Technology vs. OneSpan | Priority Technology vs. Sangoma Technologies Corp |
| Global Blue vs. Evertec | Global Blue vs. Consensus Cloud Solutions | Global Blue vs. CSG Systems International | Global Blue vs. EverCommerce |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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