Correlation Between Image Protect and Global Arena

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

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

Diversification Opportunities for Image Protect and Global Arena

0.0

Correlation Coefficient

Image Protect  Global Arena

Pay attention - limited upside

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

Pair Corralation between Image Protect and Global Arena

If you would invest  0.02  in Image Protect on December 27, 2024 and sell it today you would lose (0.01) from holding Image Protect or give up 50.0% of portfolio value over 90 days.

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

Image Protect  vs.  Global Arena Holding

Image Protect

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Image Protect are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Image Protect disclosed solid returns over the last few months and may actually be approaching a breakup point.

Global Arena Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Global Arena Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical indicators, Global Arena is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Image Protect and Global Arena

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

The idea behind Image Protect and Global Arena Holding 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.

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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.