Correlation Between GBT Technologies and CSE Global

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

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

Diversification Opportunities for GBT Technologies and CSE Global

-0.19

Correlation Coefficient

GBT Technologies  CSE Global

Good diversification

The 3 months correlation between GBT and CSE is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding GBT Technologies and CSE Global Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSE Global Limited and GBT Technologies 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 GBT Technologies are associated (or correlated) with CSE Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSE Global Limited has no effect on the direction of GBT Technologies i.e., GBT Technologies and CSE Global go up and down completely randomly.

Pair Corralation between GBT Technologies and CSE Global

Given the investment horizon of 90 days GBT Technologies is expected to generate 44.15 times more return on investment than CSE Global. However, GBT Technologies is 44.15 times more volatile than CSE Global Limited. It trades about 0.21 of its potential returns per unit of risk. CSE Global Limited is currently generating about 0.03 per unit of risk. If you would invest  0.02  in GBT Technologies on December 18, 2024 and sell it today you would lose (0.01) from holding GBT Technologies or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	88.33%
Values	Daily Returns

GBT Technologies  vs.  CSE Global Limited

GBT Technologies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GBT Technologies are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak fundamental indicators, GBT Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

CSE Global Limited

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CSE Global Limited are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward-looking indicators, CSE Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with GBT Technologies and CSE Global

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

The idea behind GBT Technologies and CSE Global Limited 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.