Correlation Between Clearwater Paper and GLT Old

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

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

Diversification Opportunities for Clearwater Paper and GLT Old

0.0

Correlation Coefficient

Clearwater Paper  GLT Old

Pay attention - limited upside

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

Pair Corralation between Clearwater Paper and GLT Old

If you would invest  2,471  in Clearwater Paper on December 19, 2024 and sell it today you would lose (37.00) from holding Clearwater Paper or give up 1.5% of portfolio value over 90 days.

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

Clearwater Paper  vs.  GLT Old

Clearwater Paper

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Clearwater Paper are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable essential indicators, Clearwater Paper is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

GLT Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days GLT Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, GLT Old is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Clearwater Paper and GLT Old

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

The idea behind Clearwater Paper and GLT Old 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.