Correlation Between Getabec Public and East Coast
Can any of the company-specific risk be diversified away by investing in both Getabec Public and East Coast 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 Getabec Public and East Coast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Getabec Public and East Coast Furnitech, you can compare the effects of market volatilities on Getabec Public and East Coast 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 Getabec Public with a short position of East Coast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getabec Public and East Coast.
Diversification Opportunities for Getabec Public and East Coast
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Getabec and East is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Getabec Public and East Coast Furnitech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Coast Furnitech and Getabec Public 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 Getabec Public are associated (or correlated) with East Coast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Coast Furnitech has no effect on the direction of Getabec Public i.e., Getabec Public and East Coast go up and down completely randomly.
Pair Corralation between Getabec Public and East Coast
Assuming the 90 days trading horizon Getabec Public is expected to generate 0.38 times more return on investment than East Coast. However, Getabec Public is 2.65 times less risky than East Coast. It trades about 0.02 of its potential returns per unit of risk. East Coast Furnitech is currently generating about -0.25 per unit of risk. If you would invest 74.00 in Getabec Public on December 29, 2024 and sell it today you would earn a total of 1.00 from holding Getabec Public or generate 1.35% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.41% |
Values | Daily Returns |
Getabec Public vs. East Coast Furnitech
Performance |
Timeline |
Getabec Public |
East Coast Furnitech |
Getabec Public and East Coast Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Getabec Public and East Coast
The main advantage of trading using opposite Getabec Public and East Coast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getabec Public position performs unexpectedly, East Coast 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 East Coast will offset losses from the drop in East Coast's long position.Getabec Public vs. Hydrotek Public | Getabec Public vs. BuilderSmart Public | Getabec Public vs. Salee Colour Public | Getabec Public vs. Home Pottery Public |
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Check out your portfolio center.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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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