Correlation Between Pacer BlueStar and GRNR

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

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

Diversification Opportunities for Pacer BlueStar and GRNR

0.09

Correlation Coefficient

Pacer BlueStar  GRNR

Significant diversification

The 3 months correlation between Pacer and GRNR is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Pacer BlueStar Engineering and GRNR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRNR and Pacer BlueStar 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 Pacer BlueStar Engineering are associated (or correlated) with GRNR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRNR has no effect on the direction of Pacer BlueStar i.e., Pacer BlueStar and GRNR go up and down completely randomly.

Pair Corralation between Pacer BlueStar and GRNR

If you would invest  2,051  in Pacer BlueStar Engineering on October 24, 2024 and sell it today you would earn a total of  174.00  from holding Pacer BlueStar Engineering or generate 8.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

Pacer BlueStar Engineering  vs.  GRNR

Pacer BlueStar Engin

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pacer BlueStar Engineering are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal essential indicators, Pacer BlueStar may actually be approaching a critical reversion point that can send shares even higher in February 2025.

GRNR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GRNR has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, GRNR is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Pacer BlueStar and GRNR

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

The idea behind Pacer BlueStar Engineering and GRNR 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 Transaction History module to view history of all your transactions and understand their impact on performance.