Correlation Between Indo Global and Buyer Group

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

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

Diversification Opportunities for Indo Global and Buyer Group

0.07

Correlation Coefficient

Indo Global  Buyer Group

Significant diversification

The 3 months correlation between Indo and Buyer is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Indo Global Exchange and Buyer Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buyer Group International and Indo 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 Indo Global Exchange are associated (or correlated) with Buyer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buyer Group International has no effect on the direction of Indo Global i.e., Indo Global and Buyer Group go up and down completely randomly.

Pair Corralation between Indo Global and Buyer Group

Given the investment horizon of 90 days Indo Global Exchange is expected to generate 1.78 times more return on investment than Buyer Group. However, Indo Global is 1.78 times more volatile than Buyer Group International. It trades about 0.03 of its potential returns per unit of risk. Buyer Group International is currently generating about 0.03 per unit of risk. If you would invest  0.05  in Indo Global Exchange on May 6, 2025 and sell it today you would lose (0.01) from holding Indo Global Exchange or give up 20.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Indo Global Exchange  vs.  Buyer Group International

Indo Global Exchange

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Indo Global Exchange are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting technical and fundamental indicators, Indo Global showed solid returns over the last few months and may actually be approaching a breakup point.

Buyer Group International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Buyer Group International are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Buyer Group reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Indo Global and Buyer Group

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

The idea behind Indo Global Exchange and Buyer Group International 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 the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .