Correlation Between Golden Matrix and Suntory Beverage

Can any of the company-specific risk be diversified away by investing in both Golden Matrix and Suntory Beverage 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 Golden Matrix and Suntory Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Golden Matrix Group and Suntory Beverage Food, you can compare the effects of market volatilities on Golden Matrix and Suntory Beverage 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 Golden Matrix with a short position of Suntory Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Matrix and Suntory Beverage.

Diversification Opportunities for Golden Matrix and Suntory Beverage

0.25

Correlation Coefficient

Golden Matrix  Suntory Beverage

Modest diversification

The 3 months correlation between Golden and Suntory is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Golden Matrix Group and Suntory Beverage Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suntory Beverage Food and Golden Matrix 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 Golden Matrix Group are associated (or correlated) with Suntory Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suntory Beverage Food has no effect on the direction of Golden Matrix i.e., Golden Matrix and Suntory Beverage go up and down completely randomly.

Pair Corralation between Golden Matrix and Suntory Beverage

Given the investment horizon of 90 days Golden Matrix Group is expected to generate 6.98 times more return on investment than Suntory Beverage. However, Golden Matrix is 6.98 times more volatile than Suntory Beverage Food. It trades about 0.05 of its potential returns per unit of risk. Suntory Beverage Food is currently generating about -0.41 per unit of risk. If you would invest  200.00  in Golden Matrix Group on October 22, 2024 and sell it today you would earn a total of  4.00  from holding Golden Matrix Group or generate 2.0% return on investment over 90 days.

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

Golden Matrix Group  vs.  Suntory Beverage Food

Golden Matrix Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

Suntory Beverage Food

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Suntory Beverage Food has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Golden Matrix and Suntory Beverage

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

The idea behind Golden Matrix Group and Suntory Beverage Food 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.