Correlation Between GomSpace Group and Maha Energy

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

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

Diversification Opportunities for GomSpace Group and Maha Energy

-0.8

Correlation Coefficient

GomSpace Group  Maha Energy

Pay attention - limited upside

The 3 months correlation between GomSpace and Maha is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding GomSpace Group AB and Maha Energy AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maha Energy AB and GomSpace 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 GomSpace Group AB are associated (or correlated) with Maha Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maha Energy AB has no effect on the direction of GomSpace Group i.e., GomSpace Group and Maha Energy go up and down completely randomly.

Pair Corralation between GomSpace Group and Maha Energy

Assuming the 90 days trading horizon GomSpace Group AB is expected to generate 2.21 times more return on investment than Maha Energy. However, GomSpace Group is 2.21 times more volatile than Maha Energy AB. It trades about 0.16 of its potential returns per unit of risk. Maha Energy AB is currently generating about -0.18 per unit of risk. If you would invest  431.00  in GomSpace Group AB on December 31, 2024 and sell it today you would earn a total of  302.00  from holding GomSpace Group AB or generate 70.07% return on investment over 90 days.

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

GomSpace Group AB  vs.  Maha Energy AB

GomSpace Group AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GomSpace Group AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, GomSpace Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Maha Energy AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Maha Energy AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical indicators remain somewhat strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with GomSpace Group and Maha Energy

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

The idea behind GomSpace Group AB and Maha Energy AB 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .