Correlation Between G5 Entertainment and Triboron International

Can any of the company-specific risk be diversified away by investing in both G5 Entertainment and Triboron International 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 Triboron International 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 Triboron International AB, you can compare the effects of market volatilities on G5 Entertainment and Triboron International 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 Triboron International. Check out your portfolio center. Please also check ongoing floating volatility patterns of G5 Entertainment and Triboron International.

Diversification Opportunities for G5 Entertainment and Triboron International

-0.54

Correlation Coefficient

G5 Entertainment  Triboron International

Excellent diversification

The 3 months correlation between G5EN and Triboron is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding G5 Entertainment publ and Triboron International AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triboron International 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 Triboron International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triboron International has no effect on the direction of G5 Entertainment i.e., G5 Entertainment and Triboron International go up and down completely randomly.

Pair Corralation between G5 Entertainment and Triboron International

Assuming the 90 days trading horizon G5 Entertainment publ is expected to generate 0.67 times more return on investment than Triboron International. However, G5 Entertainment publ is 1.5 times less risky than Triboron International. It trades about 0.21 of its potential returns per unit of risk. Triboron International AB is currently generating about -0.18 per unit of risk. If you would invest  8,940  in G5 Entertainment publ on September 22, 2024 and sell it today you would earn a total of  1,840  from holding G5 Entertainment publ or generate 20.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	97.78%
Values	Daily Returns

G5 Entertainment publ  vs.  Triboron International AB

G5 Entertainment publ

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in G5 Entertainment publ are ranked lower than 11 (%) 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.

Triboron International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Triboron International AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Triboron International is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with G5 Entertainment and Triboron International

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

The idea behind G5 Entertainment publ and Triboron International AB 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.