Correlation Between Willy Food and Gamatronic Electronic
Can any of the company-specific risk be diversified away by investing in both Willy Food and Gamatronic Electronic 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 Willy Food and Gamatronic Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Willy Food and Gamatronic Electronic Industries, you can compare the effects of market volatilities on Willy Food and Gamatronic Electronic 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 Willy Food with a short position of Gamatronic Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Willy Food and Gamatronic Electronic.
Diversification Opportunities for Willy Food and Gamatronic Electronic
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Willy and Gamatronic is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Willy Food and Gamatronic Electronic Industri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamatronic Electronic and Willy Food 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 Willy Food are associated (or correlated) with Gamatronic Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamatronic Electronic has no effect on the direction of Willy Food i.e., Willy Food and Gamatronic Electronic go up and down completely randomly.
Pair Corralation between Willy Food and Gamatronic Electronic
Assuming the 90 days trading horizon Willy Food is expected to generate 0.77 times more return on investment than Gamatronic Electronic. However, Willy Food is 1.3 times less risky than Gamatronic Electronic. It trades about 0.17 of its potential returns per unit of risk. Gamatronic Electronic Industries is currently generating about -0.05 per unit of risk. If you would invest 180,000 in Willy Food on August 29, 2024 and sell it today you would earn a total of 76,100 from holding Willy Food or generate 42.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Willy Food vs. Gamatronic Electronic Industri
Performance |
| Timeline |
| Willy Food |
| Gamatronic Electronic |
Willy Food and Gamatronic Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Willy Food and Gamatronic Electronic
The main advantage of trading using opposite Willy Food and Gamatronic Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Willy Food position performs unexpectedly, Gamatronic Electronic 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 Gamatronic Electronic will offset losses from the drop in Gamatronic Electronic's long position.| Willy Food vs. Strauss Group | Willy Food vs. B Communications | Willy Food vs. Holmes Place International | Willy Food vs. Nova |
| Gamatronic Electronic vs. Direct Capital Investments | Gamatronic Electronic vs. B Communications | Gamatronic Electronic vs. Holmes Place International | Gamatronic Electronic vs. Nova |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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