Correlation Between Genertec Universal and VODAFONE GROUP

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

By analyzing existing cross correlation between Genertec Universal Medical and VODAFONE GROUP, you can compare the effects of market volatilities on Genertec Universal and VODAFONE GROUP 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 Genertec Universal with a short position of VODAFONE GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genertec Universal and VODAFONE GROUP.

Diversification Opportunities for Genertec Universal and VODAFONE GROUP

0.83

Correlation Coefficient

Genertec Universal  VODAFONE GROUP

Very poor diversification

The 3 months correlation between Genertec and VODAFONE is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Genertec Universal Medical and VODAFONE GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VODAFONE GROUP and Genertec Universal 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 Genertec Universal Medical are associated (or correlated) with VODAFONE GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VODAFONE GROUP has no effect on the direction of Genertec Universal i.e., Genertec Universal and VODAFONE GROUP go up and down completely randomly.

Pair Corralation between Genertec Universal and VODAFONE GROUP

Assuming the 90 days horizon Genertec Universal Medical is expected to generate 1.19 times more return on investment than VODAFONE GROUP. However, Genertec Universal is 1.19 times more volatile than VODAFONE GROUP. It trades about 0.11 of its potential returns per unit of risk. VODAFONE GROUP is currently generating about 0.1 per unit of risk. If you would invest  56.00  in Genertec Universal Medical on April 23, 2025 and sell it today you would earn a total of  10.00  from holding Genertec Universal Medical or generate 17.86% return on investment over 90 days.

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

Genertec Universal Medical  vs.  VODAFONE GROUP

Genertec Universal

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Genertec Universal Medical are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Genertec Universal reported solid returns over the last few months and may actually be approaching a breakup point.

VODAFONE GROUP

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VODAFONE GROUP are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, VODAFONE GROUP unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Genertec Universal and VODAFONE GROUP

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

The idea behind Genertec Universal Medical and VODAFONE 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 Commodity Directory module to find actively traded commodities issued by global exchanges.