Correlation Between TransGlobal Assets and Galexxy Holdings

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Can any of the company-specific risk be diversified away by investing in both TransGlobal Assets and Galexxy Holdings 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 TransGlobal Assets and Galexxy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TransGlobal Assets and Galexxy Holdings, you can compare the effects of market volatilities on TransGlobal Assets and Galexxy Holdings 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 TransGlobal Assets with a short position of Galexxy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of TransGlobal Assets and Galexxy Holdings.

Diversification Opportunities for TransGlobal Assets and Galexxy Holdings

TransGlobalGalexxyDiversified AwayTransGlobalGalexxyDiversified Away100%
-0.47
  Correlation Coefficient

Very good diversification

The 3 months correlation between TransGlobal and Galexxy is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding TransGlobal Assets and Galexxy Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galexxy Holdings and TransGlobal Assets 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 TransGlobal Assets are associated (or correlated) with Galexxy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galexxy Holdings has no effect on the direction of TransGlobal Assets i.e., TransGlobal Assets and Galexxy Holdings go up and down completely randomly.

Pair Corralation between TransGlobal Assets and Galexxy Holdings

Given the investment horizon of 90 days TransGlobal Assets is expected to generate 1.07 times less return on investment than Galexxy Holdings. But when comparing it to its historical volatility, TransGlobal Assets is 1.52 times less risky than Galexxy Holdings. It trades about 0.09 of its potential returns per unit of risk. Galexxy Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1.36  in Galexxy Holdings on November 22, 2024 and sell it today you would lose (0.46) from holding Galexxy Holdings or give up 33.82% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy96.83%
ValuesDaily Returns

TransGlobal Assets  vs.  Galexxy Holdings

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -60-40-20020406080
JavaScript chart by amCharts 3.21.15TMSH GXXY
       Timeline  
TransGlobal Assets 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in TransGlobal Assets are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, TransGlobal Assets demonstrated solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.00010.000150.00020.000250.0003
Galexxy Holdings 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Galexxy Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Galexxy Holdings showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.0040.0060.0080.010.0120.0140.016

TransGlobal Assets and Galexxy Holdings Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-66.72-49.97-33.22-16.470.2816.9134.451.8969.3886.87 0.00040.00050.00060.00070.0008
JavaScript chart by amCharts 3.21.15TMSH GXXY
       Returns  

Pair Trading with TransGlobal Assets and Galexxy Holdings

The main advantage of trading using opposite TransGlobal Assets and Galexxy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TransGlobal Assets position performs unexpectedly, Galexxy Holdings 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 Galexxy Holdings will offset losses from the drop in Galexxy Holdings' long position.
The idea behind TransGlobal Assets and Galexxy Holdings 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 Global Correlations module to find global opportunities by holding instruments from different markets.

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