Correlation Between International Money and Global Blue

By analyzing existing cross correlation between International Money Express and Global Blue Group, you can compare the effects of market volatilities on International Money and Global Blue 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 International Money with a short position of Global Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Money and Global Blue.

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

Diversification Opportunities for International Money and Global Blue

0.06
  Correlation Coefficient
International Money
Global Blue Group

Significant diversification

The 3 months correlation between International and Global is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding International Money Express and Global Blue Group in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and International Money 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 International Money Express are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of International Money i.e., International Money and Global Blue go up and down completely randomly.

Pair Corralation between International Money and Global Blue

Given the investment horizon of 90 days International Money Express is expected to generate 0.41 times more return on investment than Global Blue. However, International Money Express is 2.45 times less risky than Global Blue. It trades about 0.0 of its potential returns per unit of risk. Global Blue Group is currently generating about -0.02 per unit of risk. If you would invest  1,690  in International Money Express on October 18, 2021 and sell it today you would lose (21.00)  from holding International Money Express or give up 1.24% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

International Money Express  vs.  Global Blue Group

 Performance (%) 
      Timeline 
International Money 
International Performance
0 of 100
Over the last 90 days International Money Express has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, International Money is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

International Price Channel

Global Blue Group 
Global Performance
0 of 100
Over the last 90 days Global Blue Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Global Blue is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Global Price Channel

International Money and Global Blue Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with International Money and Global Blue

The main advantage of trading using opposite International Money and Global Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Money position performs unexpectedly, Global Blue 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 Global Blue will offset losses from the drop in Global Blue's long position.
The idea behind International Money Express and Global Blue 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.
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.

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