Correlation Between INFORMATION SVC and GREENX METALS
Can any of the company-specific risk be diversified away by investing in both INFORMATION SVC and GREENX METALS 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 INFORMATION SVC and GREENX METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INFORMATION SVC GRP and GREENX METALS LTD, you can compare the effects of market volatilities on INFORMATION SVC and GREENX METALS 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 INFORMATION SVC with a short position of GREENX METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of INFORMATION SVC and GREENX METALS.
Diversification Opportunities for INFORMATION SVC and GREENX METALS
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between INFORMATION and GREENX is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding INFORMATION SVC GRP and GREENX METALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GREENX METALS LTD and INFORMATION SVC 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 INFORMATION SVC GRP are associated (or correlated) with GREENX METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GREENX METALS LTD has no effect on the direction of INFORMATION SVC i.e., INFORMATION SVC and GREENX METALS go up and down completely randomly.
Pair Corralation between INFORMATION SVC and GREENX METALS
Assuming the 90 days horizon INFORMATION SVC GRP is expected to generate 0.75 times more return on investment than GREENX METALS. However, INFORMATION SVC GRP is 1.33 times less risky than GREENX METALS. It trades about -0.06 of its potential returns per unit of risk. GREENX METALS LTD is currently generating about -0.07 per unit of risk. If you would invest 302.00 in INFORMATION SVC GRP on November 28, 2024 and sell it today you would lose (12.00) from holding INFORMATION SVC GRP or give up 3.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INFORMATION SVC GRP vs. GREENX METALS LTD
Performance |
| Timeline |
| INFORMATION SVC GRP |
| GREENX METALS LTD |
INFORMATION SVC and GREENX METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INFORMATION SVC and GREENX METALS
The main advantage of trading using opposite INFORMATION SVC and GREENX METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INFORMATION SVC position performs unexpectedly, GREENX METALS 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 GREENX METALS will offset losses from the drop in GREENX METALS's long position.| INFORMATION SVC vs. Playa Hotels Resorts | INFORMATION SVC vs. COLUMBIA SPORTSWEAR | INFORMATION SVC vs. Aristocrat Leisure Limited | INFORMATION SVC vs. TRAVEL LEISURE DL 01 |
| GREENX METALS vs. Carsales | GREENX METALS vs. Apollo Investment Corp | GREENX METALS vs. Keck Seng Investments | GREENX METALS vs. HK Electric Investments |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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