Correlation Between Sonos and GobiMin
Can any of the company-specific risk be diversified away by investing in both Sonos and GobiMin 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 Sonos and GobiMin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonos Inc and GobiMin, you can compare the effects of market volatilities on Sonos and GobiMin 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 Sonos with a short position of GobiMin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonos and GobiMin.
Diversification Opportunities for Sonos and GobiMin
Very weak diversification
The 3 months correlation between Sonos and GobiMin is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Sonos Inc and GobiMin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GobiMin and Sonos 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 Sonos Inc are associated (or correlated) with GobiMin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GobiMin has no effect on the direction of Sonos i.e., Sonos and GobiMin go up and down completely randomly.
Pair Corralation between Sonos and GobiMin
If you would invest 1,406 in Sonos Inc on September 13, 2024 and sell it today you would earn a total of 50.00 from holding Sonos Inc or generate 3.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Sonos Inc vs. GobiMin
Performance |
| Timeline |
| Sonos Inc |
| GobiMin |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sonos and GobiMin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonos and GobiMin
The main advantage of trading using opposite Sonos and GobiMin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonos position performs unexpectedly, GobiMin 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 GobiMin will offset losses from the drop in GobiMin's long position.The idea behind Sonos Inc and GobiMin pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| GobiMin vs. JD Sports Fashion | GobiMin vs. Titan Machinery | GobiMin vs. Academy Sports Outdoors | GobiMin vs. Sonos 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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