Correlation Between GAZTRTECHNIUADR15EO01 and Moncler SpA

Can any of the company-specific risk be diversified away by investing in both GAZTRTECHNIUADR15EO01 and Moncler SpA 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 GAZTRTECHNIUADR15EO01 and Moncler SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GAZTRTECHNIUADR15EO01 and Moncler SpA, you can compare the effects of market volatilities on GAZTRTECHNIUADR15EO01 and Moncler SpA 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 GAZTRTECHNIUADR15EO01 with a short position of Moncler SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAZTRTECHNIUADR15EO01 and Moncler SpA.

Diversification Opportunities for GAZTRTECHNIUADR15EO01 and Moncler SpA

-0.76

Correlation Coefficient

GAZTRTECHNIUADR15EO01  Moncler SpA

Pay attention - limited upside

The 3 months correlation between GAZTRTECHNIUADR15EO01 and Moncler is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding GAZTRTECHNIUADR15EO01 and Moncler SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moncler SpA and GAZTRTECHNIUADR15EO01 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 GAZTRTECHNIUADR15EO01 are associated (or correlated) with Moncler SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moncler SpA has no effect on the direction of GAZTRTECHNIUADR15EO01 i.e., GAZTRTECHNIUADR15EO01 and Moncler SpA go up and down completely randomly.

Pair Corralation between GAZTRTECHNIUADR15EO01 and Moncler SpA

Assuming the 90 days trading horizon GAZTRTECHNIUADR15EO01 is expected to generate 0.94 times more return on investment than Moncler SpA. However, GAZTRTECHNIUADR15EO01 is 1.07 times less risky than Moncler SpA. It trades about 0.07 of its potential returns per unit of risk. Moncler SpA is currently generating about 0.04 per unit of risk. If you would invest  2,543  in GAZTRTECHNIUADR15EO01 on October 7, 2024 and sell it today you would earn a total of  97.00  from holding GAZTRTECHNIUADR15EO01 or generate 3.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

GAZTRTECHNIUADR15EO01  vs.  Moncler SpA

GAZTRTECHNIUADR15EO01

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in GAZTRTECHNIUADR15EO01 are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical and fundamental indicators, GAZTRTECHNIUADR15EO01 may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Moncler SpA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moncler SpA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with GAZTRTECHNIUADR15EO01 and Moncler SpA

The main advantage of trading using opposite GAZTRTECHNIUADR15EO01 and Moncler SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAZTRTECHNIUADR15EO01 position performs unexpectedly, Moncler SpA 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 Moncler SpA will offset losses from the drop in Moncler SpA's long position.

The idea behind GAZTRTECHNIUADR15EO01 and Moncler SpA 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.