Correlation Between GIVOT OLAM and Amir Marketing

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

By analyzing existing cross correlation between GIVOT OLAM OIL and Amir Marketing and, you can compare the effects of market volatilities on GIVOT OLAM and Amir Marketing 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 GIVOT OLAM with a short position of Amir Marketing. Check out your portfolio center. Please also check ongoing floating volatility patterns of GIVOT OLAM and Amir Marketing.

Diversification Opportunities for GIVOT OLAM and Amir Marketing

-0.87

Correlation Coefficient

GIVOT OLAM  Amir Marketing

Pay attention - limited upside

The 3 months correlation between GIVOT and Amir is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding GIVOT OLAM OIL and Amir Marketing and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amir Marketing and GIVOT OLAM 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 GIVOT OLAM OIL are associated (or correlated) with Amir Marketing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amir Marketing has no effect on the direction of GIVOT OLAM i.e., GIVOT OLAM and Amir Marketing go up and down completely randomly.

Pair Corralation between GIVOT OLAM and Amir Marketing

Assuming the 90 days trading horizon GIVOT OLAM OIL is expected to under-perform the Amir Marketing. But the stock apears to be less risky and, when comparing its historical volatility, GIVOT OLAM OIL is 1.07 times less risky than Amir Marketing. The stock trades about -0.4 of its potential returns per unit of risk. The Amir Marketing and is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  246,000  in Amir Marketing and on March 13, 2024 and sell it today you would earn a total of  7,200  from holding Amir Marketing and or generate 2.93% return on investment over 90 days.

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

GIVOT OLAM OIL  vs.  Amir Marketing and

GIVOT OLAM OIL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GIVOT OLAM OIL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in July 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Amir Marketing

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amir Marketing and are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Amir Marketing sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GIVOT OLAM and Amir Marketing

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

The idea behind GIVOT OLAM OIL and Amir Marketing 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.

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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.