Correlation Between Gabriel Holding and Fast Ejendom

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

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

Diversification Opportunities for Gabriel Holding and Fast Ejendom

-0.59

Correlation Coefficient

Gabriel Holding  Fast Ejendom

Excellent diversification

The 3 months correlation between Gabriel and Fast is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Gabriel Holding and Fast Ejendom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fast Ejendom and Gabriel Holding 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 Gabriel Holding are associated (or correlated) with Fast Ejendom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fast Ejendom has no effect on the direction of Gabriel Holding i.e., Gabriel Holding and Fast Ejendom go up and down completely randomly.

Pair Corralation between Gabriel Holding and Fast Ejendom

Assuming the 90 days trading horizon Gabriel Holding is expected to under-perform the Fast Ejendom. In addition to that, Gabriel Holding is 1.37 times more volatile than Fast Ejendom. It trades about -0.15 of its total potential returns per unit of risk. Fast Ejendom is currently generating about 0.13 per unit of volatility. If you would invest  11,700  in Fast Ejendom on December 2, 2024 and sell it today you would earn a total of  1,700  from holding Fast Ejendom or generate 14.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Gabriel Holding  vs.  Fast Ejendom

Gabriel Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gabriel Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Fast Ejendom

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fast Ejendom are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Fast Ejendom displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gabriel Holding and Fast Ejendom

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

The idea behind Gabriel Holding and Fast Ejendom 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 Transaction History module to view history of all your transactions and understand their impact on performance.