Correlation Between Resource America and GoPro
Can any of the company-specific risk be diversified away by investing in both Resource America and GoPro 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 Resource America and GoPro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Resource America and GoPro Inc, you can compare the effects of market volatilities on Resource America and GoPro 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 Resource America with a short position of GoPro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Resource America and GoPro.
Diversification Opportunities for Resource America and GoPro
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Resource and GoPro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Resource America and GoPro Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoPro Inc and Resource America 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 Resource America are associated (or correlated) with GoPro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoPro Inc has no effect on the direction of Resource America i.e., Resource America and GoPro go up and down completely randomly.
Pair Corralation between Resource America and GoPro
If you would invest (100.00) in Resource America on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Resource America or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Resource America vs. GoPro Inc
Performance |
Timeline |
Resource America |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GoPro Inc |
Resource America and GoPro Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Resource America and GoPro
The main advantage of trading using opposite Resource America and GoPro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Resource America position performs unexpectedly, GoPro 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 GoPro will offset losses from the drop in GoPro's long position.Resource America vs. Seadrill Limited | Resource America vs. Barings BDC | Resource America vs. PennantPark Floating Rate | Resource America vs. Transocean |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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