Correlation Between T Mobile and GP Investments
Can any of the company-specific risk be diversified away by investing in both T Mobile and GP Investments 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 T Mobile and GP Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between T Mobile and GP Investments, you can compare the effects of market volatilities on T Mobile and GP Investments 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 T Mobile with a short position of GP Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of T Mobile and GP Investments.
Diversification Opportunities for T Mobile and GP Investments
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between T1MU34 and GPIV33 is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding T Mobile and GP Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GP Investments and T Mobile 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 T Mobile are associated (or correlated) with GP Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GP Investments has no effect on the direction of T Mobile i.e., T Mobile and GP Investments go up and down completely randomly.
Pair Corralation between T Mobile and GP Investments
Assuming the 90 days trading horizon T Mobile is expected to generate 0.35 times more return on investment than GP Investments. However, T Mobile is 2.88 times less risky than GP Investments. It trades about 0.21 of its potential returns per unit of risk. GP Investments is currently generating about -0.01 per unit of risk. If you would invest 55,735 in T Mobile on September 25, 2024 and sell it today you would earn a total of 12,923 from holding T Mobile or generate 23.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
T Mobile vs. GP Investments
Performance |
Timeline |
T Mobile |
GP Investments |
T Mobile and GP Investments Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with T Mobile and GP Investments
The main advantage of trading using opposite T Mobile and GP Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T Mobile position performs unexpectedly, GP Investments 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 GP Investments will offset losses from the drop in GP Investments' long position.T Mobile vs. Verizon Communications | T Mobile vs. Vodafone Group Public | T Mobile vs. ATT Inc | T Mobile vs. Telefnica SA |
GP Investments vs. BlackRock | GP Investments vs. The Bank of | GP Investments vs. Ameriprise Financial | GP Investments vs. Banco BTG Pactual |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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