Correlation Between VHAI and Global Blue
Can any of the company-specific risk be diversified away by investing in both VHAI and Global Blue 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 VHAI and Global Blue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VHAI and Global Blue Group, you can compare the effects of market volatilities on VHAI and Global Blue 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 VHAI with a short position of Global Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of VHAI and Global Blue.
Diversification Opportunities for VHAI and Global Blue
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VHAI and Global is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding VHAI and Global Blue Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and VHAI 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 VHAI are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of VHAI i.e., VHAI and Global Blue go up and down completely randomly.
Pair Corralation between VHAI and Global Blue
Given the investment horizon of 90 days VHAI is expected to under-perform the Global Blue. In addition to that, VHAI is 4.11 times more volatile than Global Blue Group. It trades about -0.22 of its total potential returns per unit of risk. Global Blue Group is currently generating about 0.06 per unit of volatility. If you would invest 471.00 in Global Blue Group on August 27, 2024 and sell it today you would earn a total of 125.00 from holding Global Blue Group or generate 26.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 75.53% |
| Values | Daily Returns |
VHAI vs. Global Blue Group
Performance |
| Timeline |
| VHAI |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Global Blue Group |
VHAI and Global Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VHAI and Global Blue
The main advantage of trading using opposite VHAI and Global Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VHAI position performs unexpectedly, Global Blue 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 Global Blue will offset losses from the drop in Global Blue's long position.| VHAI vs. Lincoln Educational Services | VHAI vs. Cracker Barrel Old | VHAI vs. Shake Shack | VHAI vs. Westrock Coffee |
| Global Blue vs. Evertec | Global Blue vs. Consensus Cloud Solutions | Global Blue vs. CSG Systems International | Global Blue vs. EverCommerce |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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