Correlation Between Graphjet Technology and Lever Global

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

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

Diversification Opportunities for Graphjet Technology and Lever Global

-0.9

Correlation Coefficient

Graphjet Technology  Lever Global

Pay attention - limited upside

The 3 months correlation between Graphjet and Lever is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Graphjet Technology and Lever Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lever Global and Graphjet 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 Graphjet Technology are associated (or correlated) with Lever Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lever Global has no effect on the direction of Graphjet Technology i.e., Graphjet Technology and Lever Global go up and down completely randomly.

Pair Corralation between Graphjet Technology and Lever Global

Considering the 90-day investment horizon Graphjet Technology is expected to generate 59.44 times more return on investment than Lever Global. However, Graphjet Technology is 59.44 times more volatile than Lever Global. It trades about 0.22 of its potential returns per unit of risk. Lever Global is currently generating about 0.41 per unit of risk. If you would invest  23.00  in Graphjet Technology on October 21, 2024 and sell it today you would earn a total of  21.00  from holding Graphjet Technology or generate 91.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	31.58%
Values	Daily Returns

Graphjet Technology  vs.  Lever Global

Graphjet Technology

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Graphjet Technology are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Graphjet Technology demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Lever Global

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lever Global are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, Lever Global reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Graphjet Technology and Lever Global

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

The idea behind Graphjet Technology and Lever Global 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.