Correlation Between Gap, and Hub Cyber

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

By analyzing existing cross correlation between The Gap, and Hub Cyber Security, you can compare the effects of market volatilities on Gap, and Hub Cyber 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 Gap, with a short position of Hub Cyber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gap, and Hub Cyber.

Diversification Opportunities for Gap, and Hub Cyber

-0.1

Correlation Coefficient

Gap,  Hub Cyber

Good diversification

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

Pair Corralation between Gap, and Hub Cyber

Considering the 90-day investment horizon The Gap, is expected to generate 0.3 times more return on investment than Hub Cyber. However, The Gap, is 3.29 times less risky than Hub Cyber. It trades about 0.14 of its potential returns per unit of risk. Hub Cyber Security is currently generating about 0.01 per unit of risk. If you would invest  2,001  in The Gap, on September 18, 2024 and sell it today you would earn a total of  483.00  from holding The Gap, or generate 24.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

The Gap,  vs.  Hub Cyber Security

Gap,

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in The Gap, are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Gap, reported solid returns over the last few months and may actually be approaching a breakup point.

Hub Cyber Security

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hub Cyber Security has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Hub Cyber is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Gap, and Hub Cyber

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

The idea behind The Gap, and Hub Cyber Security 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.