Correlation Between GCS Holdings and Brogent Technologies

Can any of the company-specific risk be diversified away by investing in both GCS Holdings and Brogent Technologies 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 GCS Holdings and Brogent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GCS Holdings and Brogent Technologies, you can compare the effects of market volatilities on GCS Holdings and Brogent Technologies 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 GCS Holdings with a short position of Brogent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCS Holdings and Brogent Technologies.

Diversification Opportunities for GCS Holdings and Brogent Technologies

-0.64

Correlation Coefficient

GCS Holdings  Brogent Technologies

Excellent diversification

The 3 months correlation between GCS and Brogent is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding GCS Holdings and Brogent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brogent Technologies and GCS Holdings 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 GCS Holdings are associated (or correlated) with Brogent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brogent Technologies has no effect on the direction of GCS Holdings i.e., GCS Holdings and Brogent Technologies go up and down completely randomly.

Pair Corralation between GCS Holdings and Brogent Technologies

If you would invest  13,945  in Brogent Technologies on September 27, 2024 and sell it today you would earn a total of  505.00  from holding Brogent Technologies or generate 3.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	0.0%
Values	Daily Returns

GCS Holdings  vs.  Brogent Technologies

GCS Holdings

Risk-Adjusted Performance

0 of 100

Strong

Over the last 90 days GCS Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, GCS Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Brogent Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brogent Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with GCS Holdings and Brogent Technologies

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

The idea behind GCS Holdings and Brogent Technologies 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.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.