Correlation Between Genesis Electronics and Global Hemp

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

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

Diversification Opportunities for Genesis Electronics and Global Hemp

0.0

Correlation Coefficient

Genesis Electronics  Global Hemp

Pay attention - limited upside

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

Pair Corralation between Genesis Electronics and Global Hemp

If you would invest  2.00  in Global Hemp Group on October 13, 2024 and sell it today you would lose (0.50) from holding Global Hemp Group or give up 25.0% of portfolio value over 90 days.

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

Genesis Electronics Group  vs.  Global Hemp Group

Genesis Electronics

Risk-Adjusted Performance

0 of 100

Very Weak

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

Global Hemp Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Hemp Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Global Hemp reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Genesis Electronics and Global Hemp

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

The idea behind Genesis Electronics Group and Global Hemp Group 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.