Correlation Between RBG Holdings and Gaztransport
Can any of the company-specific risk be diversified away by investing in both RBG Holdings and Gaztransport 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 RBG Holdings and Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RBG Holdings PLC and Gaztransport et Technigaz, you can compare the effects of market volatilities on RBG Holdings and Gaztransport 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 RBG Holdings with a short position of Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBG Holdings and Gaztransport.
Diversification Opportunities for RBG Holdings and Gaztransport
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between RBG and Gaztransport is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding RBG Holdings PLC and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz and RBG Holdings 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 RBG Holdings PLC are associated (or correlated) with Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of RBG Holdings i.e., RBG Holdings and Gaztransport go up and down completely randomly.
Pair Corralation between RBG Holdings and Gaztransport
Assuming the 90 days trading horizon RBG Holdings PLC is expected to under-perform the Gaztransport. In addition to that, RBG Holdings is 3.72 times more volatile than Gaztransport et Technigaz. It trades about -0.08 of its total potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.04 per unit of volatility. If you would invest 11,388 in Gaztransport et Technigaz on September 14, 2024 and sell it today you would earn a total of 1,882 from holding Gaztransport et Technigaz or generate 16.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RBG Holdings PLC vs. Gaztransport et Technigaz
Performance |
| Timeline |
| RBG Holdings PLC |
| Gaztransport et Technigaz |
RBG Holdings and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RBG Holdings and Gaztransport
The main advantage of trading using opposite RBG Holdings and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RBG Holdings position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| RBG Holdings vs. Gaztransport et Technigaz | RBG Holdings vs. Zinc Media Group | RBG Holdings vs. TechnipFMC PLC | RBG Holdings vs. Intermediate Capital Group |
| Gaztransport vs. Park Hotels Resorts | Gaztransport vs. Ross Stores | Gaztransport vs. Melia Hotels | Gaztransport vs. Silvercorp Metals |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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