Correlation Between Vantage Drilling and GABY

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

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

Diversification Opportunities for Vantage Drilling and GABY

0.0

Correlation Coefficient

Vantage Drilling  GABY

Pay attention - limited upside

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

Pair Corralation between Vantage Drilling and GABY

If you would invest (100.00) in GABY Inc on December 21, 2024 and sell it today you would earn a total of  100.00  from holding GABY Inc or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Vantage Drilling International  vs.  GABY Inc

Vantage Drilling Int

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vantage Drilling International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

GABY Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days GABY Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, GABY is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Vantage Drilling and GABY

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

The idea behind Vantage Drilling International and GABY 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.

Check out your portfolio center.

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.