Correlation Between Jastrzebska Spotka and GI Group

Can any of the company-specific risk be diversified away by investing in both Jastrzebska Spotka and GI Group 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 Jastrzebska Spotka and GI Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jastrzebska Spotka Weglowa and GI Group Poland, you can compare the effects of market volatilities on Jastrzebska Spotka and GI Group 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 Jastrzebska Spotka with a short position of GI Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jastrzebska Spotka and GI Group.

Diversification Opportunities for Jastrzebska Spotka and GI Group

-0.51

Correlation Coefficient

Jastrzebska Spotka  GI Group

Excellent diversification

The 3 months correlation between Jastrzebska and GIG is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Jastrzebska Spotka Weglowa and GI Group Poland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GI Group Poland and Jastrzebska Spotka 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 Jastrzebska Spotka Weglowa are associated (or correlated) with GI Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GI Group Poland has no effect on the direction of Jastrzebska Spotka i.e., Jastrzebska Spotka and GI Group go up and down completely randomly.

Pair Corralation between Jastrzebska Spotka and GI Group

Assuming the 90 days trading horizon Jastrzebska Spotka Weglowa is expected to generate 1.49 times more return on investment than GI Group. However, Jastrzebska Spotka is 1.49 times more volatile than GI Group Poland. It trades about 0.07 of its potential returns per unit of risk. GI Group Poland is currently generating about -0.05 per unit of risk. If you would invest  2,266  in Jastrzebska Spotka Weglowa on September 13, 2024 and sell it today you would earn a total of  206.00  from holding Jastrzebska Spotka Weglowa or generate 9.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Jastrzebska Spotka Weglowa  vs.  GI Group Poland

Jastrzebska Spotka

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jastrzebska Spotka Weglowa are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Jastrzebska Spotka may actually be approaching a critical reversion point that can send shares even higher in January 2025.

GI Group Poland

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GI Group Poland has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, GI Group is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Jastrzebska Spotka and GI Group

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

The idea behind Jastrzebska Spotka Weglowa and GI Group Poland 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.