Correlation Between G5 Entertainment and Goodbye Kansas

Can any of the company-specific risk be diversified away by investing in both G5 Entertainment and Goodbye Kansas 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 G5 Entertainment and Goodbye Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between G5 Entertainment publ and Goodbye Kansas Group, you can compare the effects of market volatilities on G5 Entertainment and Goodbye Kansas 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 G5 Entertainment with a short position of Goodbye Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of G5 Entertainment and Goodbye Kansas.

Diversification Opportunities for G5 Entertainment and Goodbye Kansas

0.76

Correlation Coefficient

G5 Entertainment  Goodbye Kansas

Poor diversification

The 3 months correlation between G5EN and Goodbye is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding G5 Entertainment publ and Goodbye Kansas Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodbye Kansas Group and G5 Entertainment 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 G5 Entertainment publ are associated (or correlated) with Goodbye Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodbye Kansas Group has no effect on the direction of G5 Entertainment i.e., G5 Entertainment and Goodbye Kansas go up and down completely randomly.

Pair Corralation between G5 Entertainment and Goodbye Kansas

Assuming the 90 days trading horizon G5 Entertainment is expected to generate 31.85 times less return on investment than Goodbye Kansas. But when comparing it to its historical volatility, G5 Entertainment publ is 3.78 times less risky than Goodbye Kansas. It trades about 0.04 of its potential returns per unit of risk. Goodbye Kansas Group is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  210.00  in Goodbye Kansas Group on December 4, 2024 and sell it today you would earn a total of  186.00  from holding Goodbye Kansas Group or generate 88.57% return on investment over 90 days.

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

G5 Entertainment publ  vs.  Goodbye Kansas Group

G5 Entertainment publ

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in G5 Entertainment publ are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, G5 Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Goodbye Kansas Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Goodbye Kansas Group are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, Goodbye Kansas unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with G5 Entertainment and Goodbye Kansas

The main advantage of trading using opposite G5 Entertainment and Goodbye Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G5 Entertainment position performs unexpectedly, Goodbye Kansas 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 Goodbye Kansas will offset losses from the drop in Goodbye Kansas' long position.

The idea behind G5 Entertainment publ and Goodbye Kansas Group 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.