Correlation Between Strategic Investments and GWILLI FOOD

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

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

Diversification Opportunities for Strategic Investments and GWILLI FOOD

-0.42

Correlation Coefficient

Strategic Investments  GWILLI FOOD

Very good diversification

The 3 months correlation between Strategic and GWILLI is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Investments AS and GWILLI FOOD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GWILLI FOOD and Strategic Investments 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 Strategic Investments AS are associated (or correlated) with GWILLI FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GWILLI FOOD has no effect on the direction of Strategic Investments i.e., Strategic Investments and GWILLI FOOD go up and down completely randomly.

Pair Corralation between Strategic Investments and GWILLI FOOD

Assuming the 90 days horizon Strategic Investments AS is expected to under-perform the GWILLI FOOD. In addition to that, Strategic Investments is 1.82 times more volatile than GWILLI FOOD. It trades about -0.15 of its total potential returns per unit of risk. GWILLI FOOD is currently generating about 0.3 per unit of volatility. If you would invest  1,070  in GWILLI FOOD on October 6, 2024 and sell it today you would earn a total of  510.00  from holding GWILLI FOOD or generate 47.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	97.5%
Values	Daily Returns

Strategic Investments AS  vs.  GWILLI FOOD

Strategic Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Strategic Investments AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Strategic Investments is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

GWILLI FOOD

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GWILLI FOOD are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, GWILLI FOOD exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Strategic Investments and GWILLI FOOD

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

The idea behind Strategic Investments AS and GWILLI FOOD 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.