Correlation Between GGE Old and American Realty

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

By analyzing existing cross correlation between GGE Old and American Realty Investors, you can compare the effects of market volatilities on GGE Old and American Realty 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 GGE Old with a short position of American Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of GGE Old and American Realty.

Diversification Opportunities for GGE Old and American Realty

-0.02

Correlation Coefficient

GGE Old  American Realty

Good diversification

The 3 months correlation between GGE and American is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding GGE Old and American Realty Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Realty Investors and GGE Old 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 GGE Old are associated (or correlated) with American Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Realty Investors has no effect on the direction of GGE Old i.e., GGE Old and American Realty go up and down completely randomly.

Pair Corralation between GGE Old and American Realty

If you would invest  193.00  in GGE Old on October 10, 2024 and sell it today you would earn a total of  0.00  from holding GGE Old or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

GGE Old  vs.  American Realty Investors

GGE Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GGE Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, GGE Old is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

American Realty Investors

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days American Realty Investors has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with GGE Old and American Realty

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

The idea behind GGE Old and American Realty Investors 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.