Correlation Between GEE and Hirequest
Can any of the company-specific risk be diversified away by investing in both GEE and Hirequest 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 GEE and Hirequest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEE Group and Hirequest, you can compare the effects of market volatilities on GEE and Hirequest 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 GEE with a short position of Hirequest. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEE and Hirequest.
Diversification Opportunities for GEE and Hirequest
Poor diversification
The 3 months correlation between GEE and Hirequest is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding GEE Group and Hirequest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hirequest and GEE 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 GEE Group are associated (or correlated) with Hirequest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hirequest has no effect on the direction of GEE i.e., GEE and Hirequest go up and down completely randomly.
Pair Corralation between GEE and Hirequest
Considering the 90-day investment horizon GEE Group is expected to under-perform the Hirequest. But the stock apears to be less risky and, when comparing its historical volatility, GEE Group is 1.06 times less risky than Hirequest. The stock trades about -0.02 of its potential returns per unit of risk. The Hirequest is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,447 in Hirequest on January 25, 2024 and sell it today you would lose (212.00) from holding Hirequest or give up 14.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEE Group vs. Hirequest
Performance |
| Timeline |
| GEE Group |
| Hirequest |
GEE and Hirequest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEE and Hirequest
The main advantage of trading using opposite GEE and Hirequest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEE position performs unexpectedly, Hirequest 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 Hirequest will offset losses from the drop in Hirequest's long position.The idea behind GEE Group and Hirequest 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.| Hirequest vs. Discount Print USA | Hirequest vs. Cass Information Systems | Hirequest vs. Maximus | Hirequest vs. AZZ Incorporated |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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