Correlation Between Globrands and M Yochananof

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

By analyzing existing cross correlation between Globrands Group and M Yochananof and, you can compare the effects of market volatilities on Globrands and M Yochananof 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 Globrands with a short position of M Yochananof. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globrands and M Yochananof.

Diversification Opportunities for Globrands and M Yochananof

-0.4

Correlation Coefficient

Globrands  M Yochananof

Very good diversification

The 3 months correlation between Globrands and YHNF is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Globrands Group and M Yochananof and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on M Yochananof and Globrands 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 Globrands Group are associated (or correlated) with M Yochananof. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of M Yochananof has no effect on the direction of Globrands i.e., Globrands and M Yochananof go up and down completely randomly.

Pair Corralation between Globrands and M Yochananof

Assuming the 90 days trading horizon Globrands is expected to generate 7.21 times less return on investment than M Yochananof. But when comparing it to its historical volatility, Globrands Group is 2.72 times less risky than M Yochananof. It trades about 0.08 of its potential returns per unit of risk. M Yochananof and is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  1,761,707  in M Yochananof and on January 30, 2024 and sell it today you would earn a total of  146,293  from holding M Yochananof and or generate 8.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Globrands Group  vs.  M Yochananof and

Globrands Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

M Yochananof

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in M Yochananof and are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, M Yochananof sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Globrands and M Yochananof

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

The idea behind Globrands Group and M Yochananof and 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.