Correlation Between Tenable Holdings and Global Blue

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

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

Diversification Opportunities for Tenable Holdings and Global Blue

0.27

Correlation Coefficient

Tenable Holdings  Global Blue

Modest diversification

The 3 months correlation between Tenable and Global is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Tenable Holdings and Global Blue Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and Tenable Holdings 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 Tenable Holdings are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of Tenable Holdings i.e., Tenable Holdings and Global Blue go up and down completely randomly.

Pair Corralation between Tenable Holdings and Global Blue

Given the investment horizon of 90 days Tenable Holdings is expected to generate 8.09 times less return on investment than Global Blue. But when comparing it to its historical volatility, Tenable Holdings is 2.91 times less risky than Global Blue. It trades about 0.07 of its potential returns per unit of risk. Global Blue Group is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  546.00  in Global Blue Group on September 19, 2024 and sell it today you would earn a total of  91.00  from holding Global Blue Group or generate 16.67% return on investment over 90 days.

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

Tenable Holdings  vs.  Global Blue Group

Tenable Holdings

Risk-Adjusted Performance

2 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Tenable Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Tenable Holdings is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Global Blue Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Blue Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental drivers, Global Blue sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tenable Holdings and Global Blue

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

The idea behind Tenable Holdings and Global Blue Group 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.