Correlation Between Gabriel Holding and SP Group

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

By analyzing existing cross correlation between Gabriel Holding and SP Group AS, you can compare the effects of market volatilities on Gabriel Holding and SP Group 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 SP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabriel Holding and SP Group.

Diversification Opportunities for Gabriel Holding and SP Group

0.08

Correlation Coefficient

Gabriel Holding  SP Group

Significant diversification

The 3 months correlation between Gabriel and SPG is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Gabriel Holding and SP Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SP Group AS 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 SP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SP Group AS has no effect on the direction of Gabriel Holding i.e., Gabriel Holding and SP Group go up and down completely randomly.

Pair Corralation between Gabriel Holding and SP Group

Assuming the 90 days trading horizon Gabriel Holding is expected to under-perform the SP Group. In addition to that, Gabriel Holding is 1.03 times more volatile than SP Group AS. It trades about -0.06 of its total potential returns per unit of risk. SP Group AS is currently generating about 0.09 per unit of volatility. If you would invest  20,350  in SP Group AS on September 4, 2024 and sell it today you would earn a total of  10,900  from holding SP Group AS or generate 53.56% return on investment over 90 days.

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

Gabriel Holding  vs.  SP Group AS

Gabriel Holding

Risk-Adjusted Performance

0 of 100

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 January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

SP Group AS

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SP Group AS are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, SP Group is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Gabriel Holding and SP Group

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

The idea behind Gabriel Holding and SP Group AS 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.

Check out your portfolio center.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.