Correlation Between Nasdaq and Gogoro

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

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

Diversification Opportunities for Nasdaq and Gogoro

-0.31

Correlation Coefficient

Nasdaq  Gogoro

Very good diversification

The 3 months correlation between Nasdaq and Gogoro is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and Gogoro Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gogoro Inc and Nasdaq 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 Nasdaq Inc are associated (or correlated) with Gogoro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gogoro Inc has no effect on the direction of Nasdaq i.e., Nasdaq and Gogoro go up and down completely randomly.

Pair Corralation between Nasdaq and Gogoro

Given the investment horizon of 90 days Nasdaq Inc is expected to generate 0.31 times more return on investment than Gogoro. However, Nasdaq Inc is 3.24 times less risky than Gogoro. It trades about 0.05 of its potential returns per unit of risk. Gogoro Inc is currently generating about -0.06 per unit of risk. If you would invest  5,944  in Nasdaq Inc on September 13, 2024 and sell it today you would earn a total of  2,187  from holding Nasdaq Inc or generate 36.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Nasdaq Inc  vs.  Gogoro Inc

Nasdaq Inc

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Nasdaq may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Gogoro Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gogoro Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Nasdaq and Gogoro

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

The idea behind Nasdaq Inc and Gogoro Inc 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.