Correlation Between GS Chain and Dairy Farm

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

By analyzing existing cross correlation between GS Chain PLC and Dairy Farm International, you can compare the effects of market volatilities on GS Chain and Dairy Farm 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 GS Chain with a short position of Dairy Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of GS Chain and Dairy Farm.

Diversification Opportunities for GS Chain and Dairy Farm

0.0

Correlation Coefficient

GS Chain  Dairy Farm

Pay attention - limited upside

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

Pair Corralation between GS Chain and Dairy Farm

If you would invest  60.00  in GS Chain PLC on April 20, 2025 and sell it today you would lose (15.00) from holding GS Chain PLC or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

GS Chain PLC  vs.  Dairy Farm International

GS Chain PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GS Chain PLC are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, GS Chain exhibited solid returns over the last few months and may actually be approaching a breakup point.

Dairy Farm International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dairy Farm International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Dairy Farm is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with GS Chain and Dairy Farm

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

The idea behind GS Chain PLC and Dairy Farm International 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.