Correlation Between Global Digital and Brinks

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

By analyzing existing cross correlation between Global Digital Soltn and Brinks Company, you can compare the effects of market volatilities on Global Digital and Brinks 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 Digital with a short position of Brinks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Digital and Brinks.

Diversification Opportunities for Global Digital and Brinks

0.0

Correlation Coefficient

Global Digital  Brinks

Pay attention - limited upside

The 3 months correlation between Global and Brinks is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Digital Soltn and Brinks Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brinks Company and Global Digital 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 Digital Soltn are associated (or correlated) with Brinks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brinks Company has no effect on the direction of Global Digital i.e., Global Digital and Brinks go up and down completely randomly.

Pair Corralation between Global Digital and Brinks

If you would invest  9,028  in Brinks Company on October 22, 2024 and sell it today you would earn a total of  238.00  from holding Brinks Company or generate 2.64% return on investment over 90 days.

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

Global Digital Soltn  vs.  Brinks Company

Global Digital Soltn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Global Digital Soltn has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Global Digital is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Brinks Company

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brinks Company has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Global Digital and Brinks

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

The idea behind Global Digital Soltn and Brinks Company 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.