Correlation Between GLG LIFE and MercadoLibre
Can any of the company-specific risk be diversified away by investing in both GLG LIFE and MercadoLibre 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 GLG LIFE and MercadoLibre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GLG LIFE TECH and MercadoLibre, you can compare the effects of market volatilities on GLG LIFE and MercadoLibre 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 GLG LIFE with a short position of MercadoLibre. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLG LIFE and MercadoLibre.
Diversification Opportunities for GLG LIFE and MercadoLibre
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GLG and MercadoLibre is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GLG LIFE TECH and MercadoLibre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MercadoLibre and GLG LIFE 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 GLG LIFE TECH are associated (or correlated) with MercadoLibre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MercadoLibre has no effect on the direction of GLG LIFE i.e., GLG LIFE and MercadoLibre go up and down completely randomly.
Pair Corralation between GLG LIFE and MercadoLibre
If you would invest 2.00 in GLG LIFE TECH on October 7, 2024 and sell it today you would earn a total of 0.00 from holding GLG LIFE TECH or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 97.44% |
Values | Daily Returns |
GLG LIFE TECH vs. MercadoLibre
Performance |
Timeline |
GLG LIFE TECH |
MercadoLibre |
GLG LIFE and MercadoLibre Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GLG LIFE and MercadoLibre
The main advantage of trading using opposite GLG LIFE and MercadoLibre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLG LIFE position performs unexpectedly, MercadoLibre 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 MercadoLibre will offset losses from the drop in MercadoLibre's long position.GLG LIFE vs. MAGNUM MINING EXP | GLG LIFE vs. HYATT HOTELS A | GLG LIFE vs. De Grey Mining | GLG LIFE vs. Jacquet Metal Service |
MercadoLibre vs. GALENA MINING LTD | MercadoLibre vs. Mitsui Chemicals | MercadoLibre vs. De Grey Mining | MercadoLibre vs. Soken Chemical Engineering |
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.
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