Correlation Between Global Battery and Advantage Solutions
Can any of the company-specific risk be diversified away by investing in both Global Battery and Advantage Solutions 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 Global Battery and Advantage Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Battery Metals and Advantage Solutions, you can compare the effects of market volatilities on Global Battery and Advantage Solutions 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 Global Battery with a short position of Advantage Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Battery and Advantage Solutions.
Diversification Opportunities for Global Battery and Advantage Solutions
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Advantage is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Global Battery Metals and Advantage Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantage Solutions and Global Battery 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 Global Battery Metals are associated (or correlated) with Advantage Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantage Solutions has no effect on the direction of Global Battery i.e., Global Battery and Advantage Solutions go up and down completely randomly.
Pair Corralation between Global Battery and Advantage Solutions
Assuming the 90 days horizon Global Battery Metals is expected to generate 1.16 times more return on investment than Advantage Solutions. However, Global Battery is 1.16 times more volatile than Advantage Solutions. It trades about 0.14 of its potential returns per unit of risk. Advantage Solutions is currently generating about -0.04 per unit of risk. If you would invest 1.63 in Global Battery Metals on September 12, 2024 and sell it today you would earn a total of 0.45 from holding Global Battery Metals or generate 27.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
Global Battery Metals vs. Advantage Solutions
Performance |
| Timeline |
| Global Battery Metals |
| Advantage Solutions |
Global Battery and Advantage Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Battery and Advantage Solutions
The main advantage of trading using opposite Global Battery and Advantage Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Battery position performs unexpectedly, Advantage Solutions 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 Advantage Solutions will offset losses from the drop in Advantage Solutions' long position.| Global Battery vs. Advantage Solutions | Global Battery vs. Atlas Corp | Global Battery vs. PureCycle Technologies | Global Battery vs. WM Technology |
| Advantage Solutions vs. CannBioRx Life Sciences | Advantage Solutions vs. GCM Grosvenor | Advantage Solutions vs. CuriosityStream | Advantage Solutions vs. HUMANA INC |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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