Correlation Between Sanwire and Goliath Film
Can any of the company-specific risk be diversified away by investing in both Sanwire and Goliath Film 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 Sanwire and Goliath Film into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanwire and Goliath Film and, you can compare the effects of market volatilities on Sanwire and Goliath Film 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 Sanwire with a short position of Goliath Film. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanwire and Goliath Film.
Diversification Opportunities for Sanwire and Goliath Film
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sanwire and Goliath is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sanwire and Goliath Film and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goliath Film and Sanwire 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 Sanwire are associated (or correlated) with Goliath Film. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goliath Film has no effect on the direction of Sanwire i.e., Sanwire and Goliath Film go up and down completely randomly.
Pair Corralation between Sanwire and Goliath Film
Given the investment horizon of 90 days Sanwire is expected to generate 3.22 times more return on investment than Goliath Film. However, Sanwire is 3.22 times more volatile than Goliath Film and. It trades about 0.08 of its potential returns per unit of risk. Goliath Film and is currently generating about 0.02 per unit of risk. If you would invest 0.55 in Sanwire on September 5, 2024 and sell it today you would lose (0.52) from holding Sanwire or give up 94.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.51% |
| Values | Daily Returns |
Sanwire vs. Goliath Film and
Performance |
| Timeline |
| Sanwire |
| Goliath Film |
Sanwire and Goliath Film Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanwire and Goliath Film
The main advantage of trading using opposite Sanwire and Goliath Film positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanwire position performs unexpectedly, Goliath Film 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 Goliath Film will offset losses from the drop in Goliath Film's long position.| Sanwire vs. Eline Entertainment Group | Sanwire vs. Green Leaf Innovations | Sanwire vs. Plandai Biotech | Sanwire vs. All American Gld |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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