Correlation Between Greencore Group and Space Communication

Can any of the company-specific risk be diversified away by investing in both Greencore Group and Space Communication 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 Greencore Group and Space Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Greencore Group PLC and Space Communication, you can compare the effects of market volatilities on Greencore Group and Space Communication 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 Greencore Group with a short position of Space Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greencore Group and Space Communication.

Diversification Opportunities for Greencore Group and Space Communication

0.0

Correlation Coefficient

Greencore Group  Space Communication

Pay attention - limited upside

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

Pair Corralation between Greencore Group and Space Communication

If you would invest  870.00  in Greencore Group PLC on October 9, 2024 and sell it today you would earn a total of  55.00  from holding Greencore Group PLC or generate 6.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Greencore Group PLC  vs.  Space Communication

Greencore Group PLC

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Greencore Group PLC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Greencore Group may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Space Communication

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Greencore Group and Space Communication

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

The idea behind Greencore Group PLC and Space Communication 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 Global Correlations module to find global opportunities by holding instruments from different markets.