Correlation Between Manaksia Coated and GACM Technologies

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Can any of the company-specific risk be diversified away by investing in both Manaksia Coated and GACM Technologies 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 Manaksia Coated and GACM Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manaksia Coated Metals and GACM Technologies Limited, you can compare the effects of market volatilities on Manaksia Coated and GACM Technologies 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 Manaksia Coated with a short position of GACM Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manaksia Coated and GACM Technologies.

Diversification Opportunities for Manaksia Coated and GACM Technologies

-0.11
  Correlation Coefficient

Good diversification

The 3 months correlation between Manaksia and GACM is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Manaksia Coated Metals and GACM Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GACM Technologies and Manaksia Coated 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 Manaksia Coated Metals are associated (or correlated) with GACM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GACM Technologies has no effect on the direction of Manaksia Coated i.e., Manaksia Coated and GACM Technologies go up and down completely randomly.

Pair Corralation between Manaksia Coated and GACM Technologies

Assuming the 90 days trading horizon Manaksia Coated Metals is expected to generate 1.42 times more return on investment than GACM Technologies. However, Manaksia Coated is 1.42 times more volatile than GACM Technologies Limited. It trades about 0.02 of its potential returns per unit of risk. GACM Technologies Limited is currently generating about -0.01 per unit of risk. If you would invest  14,383  in Manaksia Coated Metals on September 2, 2025 and sell it today you would earn a total of  181.00  from holding Manaksia Coated Metals or generate 1.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Manaksia Coated Metals  vs.  GACM Technologies Limited

 Performance 
       Timeline  
Manaksia Coated Metals 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Manaksia Coated Metals are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Manaksia Coated is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.
GACM Technologies 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days GACM Technologies Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, GACM Technologies is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Manaksia Coated and GACM Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Manaksia Coated and GACM Technologies

The main advantage of trading using opposite Manaksia Coated and GACM Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manaksia Coated position performs unexpectedly, GACM Technologies 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 GACM Technologies will offset losses from the drop in GACM Technologies' long position.
The idea behind Manaksia Coated Metals and GACM Technologies Limited 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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