Correlation Between GreenPro Capital and Resources Connection

Can any of the company-specific risk be diversified away by investing in both GreenPro Capital and Resources Connection 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 GreenPro Capital and Resources Connection into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GreenPro Capital Corp and Resources Connection, you can compare the effects of market volatilities on GreenPro Capital and Resources Connection 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 GreenPro Capital with a short position of Resources Connection. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenPro Capital and Resources Connection.

Diversification Opportunities for GreenPro Capital and Resources Connection

0.16

Correlation Coefficient

GreenPro Capital  Resources Connection

Average diversification

The 3 months correlation between GreenPro and Resources is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding GreenPro Capital Corp and Resources Connection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Resources Connection and GreenPro Capital 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 GreenPro Capital Corp are associated (or correlated) with Resources Connection. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Resources Connection has no effect on the direction of GreenPro Capital i.e., GreenPro Capital and Resources Connection go up and down completely randomly.

Pair Corralation between GreenPro Capital and Resources Connection

Given the investment horizon of 90 days GreenPro Capital Corp is expected to under-perform the Resources Connection. In addition to that, GreenPro Capital is 3.13 times more volatile than Resources Connection. It trades about -0.18 of its total potential returns per unit of risk. Resources Connection is currently generating about -0.07 per unit of volatility. If you would invest  840.00  in Resources Connection on September 22, 2024 and sell it today you would lose (22.00) from holding Resources Connection or give up 2.62% of portfolio value over 90 days.

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

GreenPro Capital Corp  vs.  Resources Connection

GreenPro Capital Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GreenPro Capital Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, GreenPro Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Resources Connection

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Resources Connection has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with GreenPro Capital and Resources Connection

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

The idea behind GreenPro Capital Corp and Resources Connection 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.