Correlation Between Globalink Investment and Kaiser Aluminum

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

By analyzing existing cross correlation between Globalink Investment Unit and Kaiser Aluminum, you can compare the effects of market volatilities on Globalink Investment and Kaiser Aluminum 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 Globalink Investment with a short position of Kaiser Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globalink Investment and Kaiser Aluminum.

Diversification Opportunities for Globalink Investment and Kaiser Aluminum

0.0

Correlation Coefficient

Globalink Investment  Kaiser Aluminum

Pay attention - limited upside

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

Pair Corralation between Globalink Investment and Kaiser Aluminum

If you would invest (100.00) in Globalink Investment Unit on December 22, 2024 and sell it today you would earn a total of  100.00  from holding Globalink Investment Unit or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Globalink Investment Unit  vs.  Kaiser Aluminum

Globalink Investment Unit

Risk-Adjusted Performance

Very Weak

Over the last 90 days Globalink Investment Unit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward indicators, Globalink Investment is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Kaiser Aluminum

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kaiser Aluminum has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Kaiser Aluminum is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Globalink Investment and Kaiser Aluminum

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

The idea behind Globalink Investment Unit and Kaiser Aluminum 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.