Correlation Between GSI Technology and SGH Old

Can any of the company-specific risk be diversified away by investing in both GSI Technology and SGH Old 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 GSI Technology and SGH Old into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GSI Technology and SGH Old, you can compare the effects of market volatilities on GSI Technology and SGH Old 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 GSI Technology with a short position of SGH Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of GSI Technology and SGH Old.

Diversification Opportunities for GSI Technology and SGH Old

0.0

Correlation Coefficient

GSI Technology  SGH Old

Pay attention - limited upside

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

Pair Corralation between GSI Technology and SGH Old

If you would invest (100.00) in SGH Old on December 27, 2024 and sell it today you would earn a total of  100.00  from holding SGH Old or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

GSI Technology  vs.  SGH Old

GSI Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days GSI Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

SGH Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days SGH Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, SGH Old is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with GSI Technology and SGH Old

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

The idea behind GSI Technology and SGH Old 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.