Correlation Between Rolls Royce and Global Tech
Can any of the company-specific risk be diversified away by investing in both Rolls Royce and Global Tech 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 Rolls Royce and Global Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rolls Royce Holdings plc and Global Tech Industries, you can compare the effects of market volatilities on Rolls Royce and Global Tech 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 Rolls Royce with a short position of Global Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rolls Royce and Global Tech.
Diversification Opportunities for Rolls Royce and Global Tech
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Rolls and Global is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Rolls Royce Holdings plc and Global Tech Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Tech Industries and Rolls Royce 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 Rolls Royce Holdings plc are associated (or correlated) with Global Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Tech Industries has no effect on the direction of Rolls Royce i.e., Rolls Royce and Global Tech go up and down completely randomly.
Pair Corralation between Rolls Royce and Global Tech
Assuming the 90 days horizon Rolls Royce Holdings plc is expected to under-perform the Global Tech. But the pink sheet apears to be less risky and, when comparing its historical volatility, Rolls Royce Holdings plc is 25.71 times less risky than Global Tech. The pink sheet trades about -0.04 of its potential returns per unit of risk. The Global Tech Industries is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 7.00 in Global Tech Industries on September 12, 2025 and sell it today you would lose (5.93) from holding Global Tech Industries or give up 84.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rolls Royce Holdings plc vs. Global Tech Industries
Performance |
| Timeline |
| Rolls Royce Holdings |
| Global Tech Industries |
Rolls Royce and Global Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rolls Royce and Global Tech
The main advantage of trading using opposite Rolls Royce and Global Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rolls Royce position performs unexpectedly, Global Tech 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 Global Tech will offset losses from the drop in Global Tech's long position.| Rolls Royce vs. NRP Stone | Rolls Royce vs. Global Tech Industries | Rolls Royce vs. FuelPositive Corp | Rolls Royce vs. Qualstar |
| Global Tech vs. Rolls Royce Holdings plc | Global Tech vs. NRP Stone | Global Tech vs. Born Inc | Global Tech vs. Qualstar |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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