Correlation Between Glori Energy and Supurva Healthcare

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

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

Diversification Opportunities for Glori Energy and Supurva Healthcare

0.6

Correlation Coefficient

Glori Energy  Supurva Healthcare

Poor diversification

The 3 months correlation between Glori and Supurva is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Glori Energy Technology and Supurva Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supurva Healthcare and Glori Energy 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 Glori Energy Technology are associated (or correlated) with Supurva Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supurva Healthcare has no effect on the direction of Glori Energy i.e., Glori Energy and Supurva Healthcare go up and down completely randomly.

Pair Corralation between Glori Energy and Supurva Healthcare

If you would invest  0.01  in Supurva Healthcare Group on September 17, 2024 and sell it today you would earn a total of  0.01  from holding Supurva Healthcare Group or generate 100.0% return on investment over 90 days.

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

Glori Energy Technology  vs.  Supurva Healthcare Group

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.

Supurva Healthcare

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Supurva Healthcare Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Supurva Healthcare showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Glori Energy and Supurva Healthcare

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

The idea behind Glori Energy Technology and Supurva Healthcare 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.