Correlation Between GCL Global and GCL Global

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

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

Diversification Opportunities for GCL Global and GCL Global

0.76

Correlation Coefficient

GCL Global  GCL Global

Poor diversification

The 3 months correlation between GCL and GCL is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding GCL Global Holdings and GCL Global Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCL Global Holdings and GCL Global 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 GCL Global Holdings are associated (or correlated) with GCL Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCL Global Holdings has no effect on the direction of GCL Global i.e., GCL Global and GCL Global go up and down completely randomly.

Pair Corralation between GCL Global and GCL Global

Considering the 90-day investment horizon GCL Global is expected to generate 3.83 times less return on investment than GCL Global. But when comparing it to its historical volatility, GCL Global Holdings is 3.99 times less risky than GCL Global. It trades about 0.17 of its potential returns per unit of risk. GCL Global Holdings is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  4.96  in GCL Global Holdings on May 3, 2025 and sell it today you would earn a total of  6.04  from holding GCL Global Holdings or generate 121.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	72.58%
Values	Daily Returns

GCL Global Holdings  vs.  GCL Global Holdings

GCL Global Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GCL Global Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating fundamental indicators, GCL Global disclosed solid returns over the last few months and may actually be approaching a breakup point.

GCL Global Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GCL Global Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, GCL Global showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GCL Global and GCL Global

The main advantage of trading using opposite GCL Global and GCL Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCL Global position performs unexpectedly, GCL Global 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 GCL Global will offset losses from the drop in GCL Global's long position.

The idea behind GCL Global Holdings and GCL Global Holdings 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.

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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.