Correlation Between Mgame Corp and PlayD
Can any of the company-specific risk be diversified away by investing in both Mgame Corp and PlayD 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 Mgame Corp and PlayD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mgame Corp and PlayD Co, you can compare the effects of market volatilities on Mgame Corp and PlayD 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 Mgame Corp with a short position of PlayD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mgame Corp and PlayD.
Diversification Opportunities for Mgame Corp and PlayD
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mgame and PlayD is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Mgame Corp and PlayD Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlayD and Mgame Corp 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 Mgame Corp are associated (or correlated) with PlayD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlayD has no effect on the direction of Mgame Corp i.e., Mgame Corp and PlayD go up and down completely randomly.
Pair Corralation between Mgame Corp and PlayD
Assuming the 90 days trading horizon Mgame Corp is expected to under-perform the PlayD. But the stock apears to be less risky and, when comparing its historical volatility, Mgame Corp is 1.92 times less risky than PlayD. The stock trades about -0.02 of its potential returns per unit of risk. The PlayD Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 745,000 in PlayD Co on October 26, 2024 and sell it today you would lose (118,000) from holding PlayD Co or give up 15.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.22% |
| Values | Daily Returns |
Mgame Corp vs. PlayD Co
Performance |
| Timeline |
| Mgame Corp |
| PlayD |
Mgame Corp and PlayD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mgame Corp and PlayD
The main advantage of trading using opposite Mgame Corp and PlayD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mgame Corp position performs unexpectedly, PlayD 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 PlayD will offset losses from the drop in PlayD's long position.| Mgame Corp vs. TS Investment Corp | Mgame Corp vs. Nh Investment And | Mgame Corp vs. Atinum Investment Co | Mgame Corp vs. Daejung Chemicals Metals |
| PlayD vs. KT Submarine Telecom | PlayD vs. Lotte Data Communication | PlayD vs. Kukdo Chemical Co | PlayD vs. Sejong Telecom |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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