Correlation Between GWOCN and AMREP

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

By analyzing existing cross correlation between GWOCN 415 03 JUN 47 and AMREP, you can compare the effects of market volatilities on GWOCN and AMREP 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 GWOCN with a short position of AMREP. Check out your portfolio center. Please also check ongoing floating volatility patterns of GWOCN and AMREP.

Diversification Opportunities for GWOCN and AMREP

0.0

Correlation Coefficient

GWOCN  AMREP

Pay attention - limited upside

The 3 months correlation between GWOCN and AMREP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GWOCN 415 03 JUN 47 and AMREP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMREP and GWOCN 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 GWOCN 415 03 JUN 47 are associated (or correlated) with AMREP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMREP has no effect on the direction of GWOCN i.e., GWOCN and AMREP go up and down completely randomly.

Pair Corralation between GWOCN and AMREP

If you would invest  3,191  in AMREP on October 21, 2024 and sell it today you would earn a total of  87.00  from holding AMREP or generate 2.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.26%
Values	Daily Returns

GWOCN 415 03 JUN 47  vs.  AMREP

GWOCN 415 03

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GWOCN 415 03 JUN 47 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, GWOCN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

AMREP

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AMREP are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, AMREP reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GWOCN and AMREP

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

The idea behind GWOCN 415 03 JUN 47 and AMREP 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.