Correlation Between United Guardian and Getty Images
Can any of the company-specific risk be diversified away by investing in both United Guardian and Getty Images 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 United Guardian and Getty Images into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Guardian and Getty Images Holdings, you can compare the effects of market volatilities on United Guardian and Getty Images 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 United Guardian with a short position of Getty Images. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Guardian and Getty Images.
Diversification Opportunities for United Guardian and Getty Images
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between United and Getty is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding United Guardian and Getty Images Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images Holdings and United Guardian 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 United Guardian are associated (or correlated) with Getty Images. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images Holdings has no effect on the direction of United Guardian i.e., United Guardian and Getty Images go up and down completely randomly.
Pair Corralation between United Guardian and Getty Images
Allowing for the 90-day total investment horizon United Guardian is expected to generate 0.66 times more return on investment than Getty Images. However, United Guardian is 1.52 times less risky than Getty Images. It trades about -0.02 of its potential returns per unit of risk. Getty Images Holdings is currently generating about -0.24 per unit of risk. If you would invest 1,053 in United Guardian on November 28, 2024 and sell it today you would lose (16.00) from holding United Guardian or give up 1.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Guardian vs. Getty Images Holdings
Performance |
| Timeline |
| United Guardian |
| Getty Images Holdings |
United Guardian and Getty Images Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Guardian and Getty Images
The main advantage of trading using opposite United Guardian and Getty Images positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Guardian position performs unexpectedly, Getty Images 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 Getty Images will offset losses from the drop in Getty Images' long position.| United Guardian vs. Utah Medical Products | United Guardian vs. Union Bankshares | United Guardian vs. Unity Bancorp |
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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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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