Correlation Between Global Blue and Rekor Systems

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

Diversification Opportunities for Global Blue and Rekor Systems

-0.58

Correlation Coefficient

Global Blue  Rekor Systems

Excellent diversification

The 3 months correlation between Global and Rekor is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Global Blue Group and Rekor Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rekor Systems 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 Rekor Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rekor Systems has no effect on the direction of Global Blue i.e., Global Blue and Rekor Systems go up and down completely randomly.

Pair Corralation between Global Blue and Rekor Systems

Allowing for the 90-day total investment horizon Global Blue Group is expected to generate 0.67 times more return on investment than Rekor Systems. However, Global Blue Group is 1.49 times less risky than Rekor Systems. It trades about 0.04 of its potential returns per unit of risk. Rekor Systems is currently generating about -0.08 per unit of risk. If you would invest  578.00  in Global Blue Group on September 14, 2024 and sell it today you would earn a total of  28.00  from holding Global Blue Group or generate 4.84% return on investment over 90 days.

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

Global Blue Group  vs.  Rekor Systems

Global Blue Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Global Blue Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental drivers, Global Blue may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Rekor Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rekor Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Global Blue and Rekor Systems

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

The idea behind Global Blue Group and Rekor Systems 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.