Correlation Between Forwardly and Glori Energy

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

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

Diversification Opportunities for Forwardly and Glori Energy

-0.1

Correlation Coefficient

Forwardly  Glori Energy

Good diversification

The 3 months correlation between Forwardly and Glori is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Forwardly and Glori Energy Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glori Energy Technology and Forwardly 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 Forwardly are associated (or correlated) with Glori Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glori Energy Technology has no effect on the direction of Forwardly i.e., Forwardly and Glori Energy go up and down completely randomly.

Pair Corralation between Forwardly and Glori Energy

If you would invest  0.62  in Forwardly on September 28, 2024 and sell it today you would earn a total of  0.13  from holding Forwardly or generate 20.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Forwardly  vs.  Glori Energy Technology

Forwardly

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Forwardly are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Forwardly showed solid returns over the last few months and may actually be approaching a breakup point.

Glori Energy Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Glori Energy Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Glori Energy is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Forwardly and Glori Energy

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

The idea behind Forwardly and Glori Energy Technology 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.