Correlation Between GDI Property and Auctus Alternative

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

By analyzing existing cross correlation between GDI Property Group and Auctus Alternative Investments, you can compare the effects of market volatilities on GDI Property and Auctus Alternative 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 GDI Property with a short position of Auctus Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of GDI Property and Auctus Alternative.

Diversification Opportunities for GDI Property and Auctus Alternative

-0.08

Correlation Coefficient

GDI Property  Auctus Alternative

Good diversification

The 3 months correlation between GDI and Auctus is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding GDI Property Group and Auctus Alternative Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auctus Alternative and GDI Property 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 GDI Property Group are associated (or correlated) with Auctus Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auctus Alternative has no effect on the direction of GDI Property i.e., GDI Property and Auctus Alternative go up and down completely randomly.

Pair Corralation between GDI Property and Auctus Alternative

Assuming the 90 days trading horizon GDI Property Group is expected to under-perform the Auctus Alternative. But the stock apears to be less risky and, when comparing its historical volatility, GDI Property Group is 1.5 times less risky than Auctus Alternative. The stock trades about -0.06 of its potential returns per unit of risk. The Auctus Alternative Investments is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  50.00  in Auctus Alternative Investments on September 3, 2024 and sell it today you would lose (2.00) from holding Auctus Alternative Investments or give up 4.0% of portfolio value over 90 days.

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

GDI Property Group  vs.  Auctus Alternative Investments

GDI Property Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GDI Property Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's forward indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Auctus Alternative

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Auctus Alternative Investments has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Auctus Alternative 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 GDI Property and Auctus Alternative

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

The idea behind GDI Property Group and Auctus Alternative Investments 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.