Correlation Between 02005NBF6 and Getty Images

Can any of the company-specific risk be diversified away by investing in both 02005NBF6 and Getty Images 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 02005NBF6 and Getty Images into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ally Financial 575 and Getty Images Holdings, you can compare the effects of market volatilities on 02005NBF6 and Getty Images 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 02005NBF6 with a short position of Getty Images. Check out your portfolio center. Please also check ongoing floating volatility patterns of 02005NBF6 and Getty Images.

Diversification Opportunities for 02005NBF6 and Getty Images

0.21

Correlation Coefficient

02005NBF6  Getty Images

Modest diversification

The 3 months correlation between 02005NBF6 and Getty is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ally Financial 575 and Getty Images Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images Holdings and 02005NBF6 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 Ally Financial 575 are associated (or correlated) with Getty Images. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images Holdings has no effect on the direction of 02005NBF6 i.e., 02005NBF6 and Getty Images go up and down completely randomly.

Pair Corralation between 02005NBF6 and Getty Images

Assuming the 90 days trading horizon Ally Financial 575 is expected to under-perform the Getty Images. But the bond apears to be less risky and, when comparing its historical volatility, Ally Financial 575 is 17.42 times less risky than Getty Images. The bond trades about -0.03 of its potential returns per unit of risk. The Getty Images Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  229.00  in Getty Images Holdings on December 25, 2024 and sell it today you would lose (9.00) from holding Getty Images Holdings or give up 3.93% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	96.72%
Values	Daily Returns

Ally Financial 575  vs.  Getty Images Holdings

Ally Financial 575

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ally Financial 575 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 02005NBF6 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Getty Images Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Getty Images Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Getty Images is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with 02005NBF6 and Getty Images

The main advantage of trading using opposite 02005NBF6 and Getty Images positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 02005NBF6 position performs unexpectedly, Getty Images 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 Getty Images will offset losses from the drop in Getty Images' long position.

The idea behind Ally Financial 575 and Getty Images 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.