Correlation Between GomSpace Group and SaltX Technology

Can any of the company-specific risk be diversified away by investing in both GomSpace Group and SaltX Technology 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 SaltX Technology 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 SaltX Technology Holding, you can compare the effects of market volatilities on GomSpace Group and SaltX Technology 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 SaltX Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of GomSpace Group and SaltX Technology.

Diversification Opportunities for GomSpace Group and SaltX Technology

-0.25

Correlation Coefficient

GomSpace Group  SaltX Technology

Very good diversification

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

Pair Corralation between GomSpace Group and SaltX Technology

Assuming the 90 days trading horizon GomSpace Group AB is expected to generate 0.99 times more return on investment than SaltX Technology. However, GomSpace Group AB is 1.01 times less risky than SaltX Technology. It trades about 0.04 of its potential returns per unit of risk. SaltX Technology Holding is currently generating about 0.01 per unit of risk. If you would invest  374.00  in GomSpace Group AB on August 31, 2024 and sell it today you would earn a total of  83.00  from holding GomSpace Group AB or generate 22.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

GomSpace Group AB  vs.  SaltX Technology Holding

GomSpace Group AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GomSpace Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

SaltX Technology Holding

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SaltX Technology Holding are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain essential indicators, SaltX Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GomSpace Group and SaltX Technology

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

The idea behind GomSpace Group AB and SaltX Technology Holding 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 .