Correlation Between GN Store and Alm Brand

Can any of the company-specific risk be diversified away by investing in both GN Store and Alm Brand 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 GN Store and Alm Brand into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GN Store Nord and Alm Brand, you can compare the effects of market volatilities on GN Store and Alm Brand 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 GN Store with a short position of Alm Brand. Check out your portfolio center. Please also check ongoing floating volatility patterns of GN Store and Alm Brand.

Diversification Opportunities for GN Store and Alm Brand

-0.45

Correlation Coefficient

GN Store  Alm Brand

Very good diversification

The 3 months correlation between GN Store and Alm is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding GN Store Nord and Alm Brand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alm Brand and GN Store 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 GN Store Nord are associated (or correlated) with Alm Brand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alm Brand has no effect on the direction of GN Store i.e., GN Store and Alm Brand go up and down completely randomly.

Pair Corralation between GN Store and Alm Brand

Assuming the 90 days horizon GN Store Nord is expected to under-perform the Alm Brand. In addition to that, GN Store is 2.5 times more volatile than Alm Brand. It trades about -0.07 of its total potential returns per unit of risk. Alm Brand is currently generating about 0.23 per unit of volatility. If you would invest  1,403  in Alm Brand on December 29, 2024 and sell it today you would earn a total of  257.00  from holding Alm Brand or generate 18.32% return on investment over 90 days.

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

GN Store Nord  vs.  Alm Brand

GN Store Nord

Risk-Adjusted Performance

Very Weak

Over the last 90 days GN Store Nord has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Alm Brand

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Alm Brand are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Alm Brand displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GN Store and Alm Brand

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

The idea behind GN Store Nord and Alm Brand 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 Commodity Directory module to find actively traded commodities issued by global exchanges.