Correlation Between GACM Technologies and 63 Moons

Can any of the company-specific risk be diversified away by investing in both GACM Technologies and 63 Moons 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 GACM Technologies and 63 Moons into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GACM Technologies Limited and 63 moons technologies, you can compare the effects of market volatilities on GACM Technologies and 63 Moons 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 GACM Technologies with a short position of 63 Moons. Check out your portfolio center. Please also check ongoing floating volatility patterns of GACM Technologies and 63 Moons.

Diversification Opportunities for GACM Technologies and 63 Moons

0.09

Correlation Coefficient

GACM Technologies  63 Moons

Significant diversification

The 3 months correlation between GACM and 63MOONS is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding GACM Technologies Limited and 63 moons technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 63 moons technologies and GACM Technologies 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 GACM Technologies Limited are associated (or correlated) with 63 Moons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 63 moons technologies has no effect on the direction of GACM Technologies i.e., GACM Technologies and 63 Moons go up and down completely randomly.

Pair Corralation between GACM Technologies and 63 Moons

Assuming the 90 days trading horizon GACM Technologies Limited is expected to under-perform the 63 Moons. But the stock apears to be less risky and, when comparing its historical volatility, GACM Technologies Limited is 1.01 times less risky than 63 Moons. The stock trades about -0.2 of its potential returns per unit of risk. The 63 moons technologies is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  16,411  in 63 moons technologies on October 10, 2024 and sell it today you would earn a total of  74,054  from holding 63 moons technologies or generate 451.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	76.08%
Values	Daily Returns

GACM Technologies Limited  vs.  63 moons technologies

GACM Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GACM Technologies Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

63 moons technologies

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in 63 moons technologies are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, 63 Moons unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GACM Technologies and 63 Moons

The main advantage of trading using opposite GACM Technologies and 63 Moons positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GACM Technologies position performs unexpectedly, 63 Moons 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 63 Moons will offset losses from the drop in 63 Moons' long position.

The idea behind GACM Technologies Limited and 63 moons technologies 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.