Correlation Between Glucose Health and Newpark Resources

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

By analyzing existing cross correlation between Glucose Health and Newpark Resources, you can compare the effects of market volatilities on Glucose Health and Newpark Resources 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 Glucose Health with a short position of Newpark Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glucose Health and Newpark Resources.

Diversification Opportunities for Glucose Health and Newpark Resources

-0.38

Correlation Coefficient

Glucose Health  Newpark Resources

Very good diversification

The 3 months correlation between Glucose and Newpark is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Glucose Health and Newpark Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newpark Resources and Glucose Health 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 Glucose Health are associated (or correlated) with Newpark Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newpark Resources has no effect on the direction of Glucose Health i.e., Glucose Health and Newpark Resources go up and down completely randomly.

Pair Corralation between Glucose Health and Newpark Resources

If you would invest  12.00  in Glucose Health on October 21, 2024 and sell it today you would earn a total of  2.00  from holding Glucose Health or generate 16.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.26%
Values	Daily Returns

Glucose Health  vs.  Newpark Resources

Glucose Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Glucose Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather weak basic indicators, Glucose Health may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Newpark Resources

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Newpark Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Newpark Resources is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Glucose Health and Newpark Resources

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

The idea behind Glucose Health and Newpark Resources 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.