Correlation Between Global Payment and Eline Entertainment

Can any of the company-specific risk be diversified away by investing in both Global Payment and Eline Entertainment 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 Global Payment and Eline Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global Payment Technologies and Eline Entertainment Group, you can compare the effects of market volatilities on Global Payment and Eline Entertainment 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 Global Payment with a short position of Eline Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Payment and Eline Entertainment.

Diversification Opportunities for Global Payment and Eline Entertainment

0.0

Correlation Coefficient

Global Payment  Eline Entertainment

Pay attention - limited upside

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

Pair Corralation between Global Payment and Eline Entertainment

If you would invest  0.01  in Eline Entertainment Group on September 12, 2024 and sell it today you would earn a total of  0.01  from holding Eline Entertainment Group or generate 100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Global Payment Technologies  vs.  Eline Entertainment Group

Global Payment Techn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Global Payment Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Global Payment is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Eline Entertainment

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eline Entertainment Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating technical and fundamental indicators, Eline Entertainment demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Global Payment and Eline Entertainment

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

The idea behind Global Payment Technologies and Eline Entertainment Group 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.