Correlation Between Global Power and ING Groep
Can any of the company-specific risk be diversified away by investing in both Global Power and ING Groep 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 Global Power and ING Groep into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Power Equipment and ING Groep NV, you can compare the effects of market volatilities on Global Power and ING Groep 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 Global Power with a short position of ING Groep. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Power and ING Groep.
Diversification Opportunities for Global Power and ING Groep
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Global and ING is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Power Equipment and ING Groep NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ING Groep NV and Global Power 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 Global Power Equipment are associated (or correlated) with ING Groep. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ING Groep NV has no effect on the direction of Global Power i.e., Global Power and ING Groep go up and down completely randomly.
Pair Corralation between Global Power and ING Groep
If you would invest (100.00) in ING Groep NV on January 20, 2024 and sell it today you would earn a total of 100.00 from holding ING Groep NV or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Global Power Equipment vs. ING Groep NV
Performance |
Timeline |
Global Power Equipment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ING Groep NV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Global Power and ING Groep Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Global Power and ING Groep
The main advantage of trading using opposite Global Power and ING Groep positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Power position performs unexpectedly, ING Groep 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 ING Groep will offset losses from the drop in ING Groep's long position.Global Power vs. Fidus Investment Corp | Global Power vs. Blue Owl Capital | Global Power vs. China Aircraft Leasing | Global Power vs. HE Equipment Services |
ING Groep vs. Duckhorn Portfolio | ING Groep vs. Compania Cervecerias Unidas | ING Groep vs. Boston Beer | ING Groep vs. Molson Coors Brewing |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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