Correlation Between Glory Star and John Wiley

Can any of the company-specific risk be diversified away by investing in both Glory Star and John Wiley 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 Glory Star and John Wiley into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Glory Star New and John Wiley Sons, you can compare the effects of market volatilities on Glory Star and John Wiley 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 Glory Star with a short position of John Wiley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glory Star and John Wiley.

Diversification Opportunities for Glory Star and John Wiley

-0.35

Correlation Coefficient

Glory Star  John Wiley

Very good diversification

The 3 months correlation between Glory and John is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Glory Star New and John Wiley Sons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Wiley Sons and Glory Star 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 Glory Star New are associated (or correlated) with John Wiley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Wiley Sons has no effect on the direction of Glory Star i.e., Glory Star and John Wiley go up and down completely randomly.

Pair Corralation between Glory Star and John Wiley

Assuming the 90 days horizon Glory Star New is expected to under-perform the John Wiley. In addition to that, Glory Star is 18.45 times more volatile than John Wiley Sons. It trades about -0.12 of its total potential returns per unit of risk. John Wiley Sons is currently generating about -0.2 per unit of volatility. If you would invest  4,569  in John Wiley Sons on October 6, 2024 and sell it today you would lose (163.00) from holding John Wiley Sons or give up 3.57% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.71%
Values	Daily Returns

Glory Star New  vs.  John Wiley Sons

Glory Star New

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Glory Star New has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly conflicting technical and fundamental indicators, Glory Star may actually be approaching a critical reversion point that can send shares even higher in February 2025.

John Wiley Sons

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Glory Star and John Wiley

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

The idea behind Glory Star New and John Wiley Sons 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.