Correlation Between 1919 Financial and Glg Intl
Can any of the company-specific risk be diversified away by investing in both 1919 Financial and Glg Intl 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 1919 Financial and Glg Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1919 Financial Services and Glg Intl Small, you can compare the effects of market volatilities on 1919 Financial and Glg Intl 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 1919 Financial with a short position of Glg Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1919 Financial and Glg Intl.
Diversification Opportunities for 1919 Financial and Glg Intl
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between 1919 and Glg is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding 1919 Financial Services and Glg Intl Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glg Intl Small and 1919 Financial 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 1919 Financial Services are associated (or correlated) with Glg Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glg Intl Small has no effect on the direction of 1919 Financial i.e., 1919 Financial and Glg Intl go up and down completely randomly.
Pair Corralation between 1919 Financial and Glg Intl
Assuming the 90 days horizon 1919 Financial is expected to generate 2.88 times less return on investment than Glg Intl. In addition to that, 1919 Financial is 1.13 times more volatile than Glg Intl Small. It trades about 0.03 of its total potential returns per unit of risk. Glg Intl Small is currently generating about 0.09 per unit of volatility. If you would invest 5,272 in Glg Intl Small on September 25, 2024 and sell it today you would earn a total of 3,288 from holding Glg Intl Small or generate 62.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
1919 Financial Services vs. Glg Intl Small
Performance |
| Timeline |
| 1919 Financial Services |
| Glg Intl Small |
1919 Financial and Glg Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1919 Financial and Glg Intl
The main advantage of trading using opposite 1919 Financial and Glg Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1919 Financial position performs unexpectedly, Glg Intl 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 Glg Intl will offset losses from the drop in Glg Intl's long position.| 1919 Financial vs. Aig Government Money | 1919 Financial vs. Ridgeworth Seix Government | 1919 Financial vs. Virtus Seix Government | 1919 Financial vs. Dreyfus Government Cash |
| Glg Intl vs. 1919 Financial Services | Glg Intl vs. Goldman Sachs Financial | Glg Intl vs. Gabelli Global Financial | Glg Intl vs. Prudential Jennison Financial |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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