Correlation Between Global Standard and M Venture

Can any of the company-specific risk be diversified away by investing in both Global Standard and M Venture 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 Global Standard and M Venture into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global Standard Technology and M Venture Investment, you can compare the effects of market volatilities on Global Standard and M Venture 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 Global Standard with a short position of M Venture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Standard and M Venture.

Diversification Opportunities for Global Standard and M Venture

0.0

Correlation Coefficient

Global Standard  M Venture

Pay attention - limited upside

The 3 months correlation between Global and 019590 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Standard Technology and M Venture Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on M Venture Investment and Global Standard 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 Global Standard Technology are associated (or correlated) with M Venture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of M Venture Investment has no effect on the direction of Global Standard i.e., Global Standard and M Venture go up and down completely randomly.

Pair Corralation between Global Standard and M Venture

If you would invest  1,674,000  in Global Standard Technology on December 28, 2024 and sell it today you would earn a total of  222,000  from holding Global Standard Technology or generate 13.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Global Standard Technology  vs.  M Venture Investment

Global Standard Tech

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Global Standard Technology are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Global Standard sustained solid returns over the last few months and may actually be approaching a breakup point.

M Venture Investment

Risk-Adjusted Performance

Very Weak

Over the last 90 days M Venture Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, M Venture is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Global Standard and M Venture

The main advantage of trading using opposite Global Standard and M Venture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Standard position performs unexpectedly, M Venture 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 M Venture will offset losses from the drop in M Venture's long position.

The idea behind Global Standard Technology and M Venture Investment 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.

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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.