Correlation Between Emerald Expositions and GBX International

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

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

Diversification Opportunities for Emerald Expositions and GBX International

0.35

Correlation Coefficient

Emerald Expositions  GBX International

Weak diversification

The 3 months correlation between Emerald and GBX is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Emerald Expositions Events and GBX International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GBX International and Emerald Expositions 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 Emerald Expositions Events are associated (or correlated) with GBX International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GBX International has no effect on the direction of Emerald Expositions i.e., Emerald Expositions and GBX International go up and down completely randomly.

Pair Corralation between Emerald Expositions and GBX International

If you would invest  0.02  in GBX International Group on September 23, 2024 and sell it today you would earn a total of  0.00  from holding GBX International Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Emerald Expositions Events  vs.  GBX International Group

Emerald Expositions

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Emerald Expositions Events are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical and fundamental indicators, Emerald Expositions is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

GBX International

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GBX International Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, GBX International demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Emerald Expositions and GBX International

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

The idea behind Emerald Expositions Events and GBX International 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.