Correlation Between GLOBUS MEDICAL and Bollor SE

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

By analyzing existing cross correlation between GLOBUS MEDICAL A and Bollor SE, you can compare the effects of market volatilities on GLOBUS MEDICAL and Bollor SE 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 GLOBUS MEDICAL with a short position of Bollor SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLOBUS MEDICAL and Bollor SE.

Diversification Opportunities for GLOBUS MEDICAL and Bollor SE

0.12

Correlation Coefficient

GLOBUS MEDICAL  Bollor SE

Average diversification

The 3 months correlation between GLOBUS and Bollor is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding GLOBUS MEDICAL A and Bollor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bollor SE and GLOBUS MEDICAL 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 GLOBUS MEDICAL A are associated (or correlated) with Bollor SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bollor SE has no effect on the direction of GLOBUS MEDICAL i.e., GLOBUS MEDICAL and Bollor SE go up and down completely randomly.

Pair Corralation between GLOBUS MEDICAL and Bollor SE

Assuming the 90 days trading horizon GLOBUS MEDICAL A is expected to under-perform the Bollor SE. In addition to that, GLOBUS MEDICAL is 1.26 times more volatile than Bollor SE. It trades about -0.09 of its total potential returns per unit of risk. Bollor SE is currently generating about -0.03 per unit of volatility. If you would invest  579.00  in Bollor SE on December 27, 2024 and sell it today you would lose (21.00) from holding Bollor SE or give up 3.63% of portfolio value over 90 days.

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

GLOBUS MEDICAL A  vs.  Bollor SE

GLOBUS MEDICAL A

Risk-Adjusted Performance

Very Weak

Over the last 90 days GLOBUS MEDICAL A has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Bollor SE

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bollor SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Bollor SE is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with GLOBUS MEDICAL and Bollor SE

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

The idea behind GLOBUS MEDICAL A and Bollor SE 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.