Correlation Between Global Blue and Life360, Common

Can any of the company-specific risk be diversified away by investing in both Global Blue and Life360, Common 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 Global Blue and Life360, Common into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global Blue Group and Life360, Common Stock, you can compare the effects of market volatilities on Global Blue and Life360, Common 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 Global Blue with a short position of Life360, Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Blue and Life360, Common.

Diversification Opportunities for Global Blue and Life360, Common

-0.14

Correlation Coefficient

Global Blue  Life360, Common

Good diversification

The 3 months correlation between Global and Life360, is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Global Blue Group and Life360, Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life360, Common Stock and Global Blue 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 Global Blue Group are associated (or correlated) with Life360, Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life360, Common Stock has no effect on the direction of Global Blue i.e., Global Blue and Life360, Common go up and down completely randomly.

Pair Corralation between Global Blue and Life360, Common

Allowing for the 90-day total investment horizon Global Blue Group is expected to generate 1.07 times more return on investment than Life360, Common. However, Global Blue is 1.07 times more volatile than Life360, Common Stock. It trades about 0.24 of its potential returns per unit of risk. Life360, Common Stock is currently generating about -0.04 per unit of risk. If you would invest  549.00  in Global Blue Group on October 7, 2024 and sell it today you would earn a total of  216.00  from holding Global Blue Group or generate 39.34% return on investment over 90 days.

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

Global Blue Group  vs.  Life360, Common Stock

Global Blue Group

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Global Blue Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental drivers, Global Blue sustained solid returns over the last few months and may actually be approaching a breakup point.

Life360, Common Stock

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Life360, Common Stock are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, Life360, Common is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Global Blue and Life360, Common

The main advantage of trading using opposite Global Blue and Life360, Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Blue position performs unexpectedly, Life360, Common 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 Life360, Common will offset losses from the drop in Life360, Common's long position.

The idea behind Global Blue Group and Life360, Common Stock 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.