Correlation Between Mgame Corp and BGF Retail
Can any of the company-specific risk be diversified away by investing in both Mgame Corp and BGF Retail 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 BGF Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mgame Corp and BGF Retail Co, you can compare the effects of market volatilities on Mgame Corp and BGF Retail 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 BGF Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mgame Corp and BGF Retail.
Diversification Opportunities for Mgame Corp and BGF Retail
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mgame and BGF is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Mgame Corp and BGF Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF Retail 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 BGF Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGF Retail has no effect on the direction of Mgame Corp i.e., Mgame Corp and BGF Retail go up and down completely randomly.
Pair Corralation between Mgame Corp and BGF Retail
Assuming the 90 days trading horizon Mgame Corp is expected to under-perform the BGF Retail. In addition to that, Mgame Corp is 2.12 times more volatile than BGF Retail Co. It trades about -0.11 of its total potential returns per unit of risk. BGF Retail Co is currently generating about -0.08 per unit of volatility. If you would invest 11,410,000 in BGF Retail Co on August 31, 2024 and sell it today you would lose (510,000) from holding BGF Retail Co or give up 4.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mgame Corp vs. BGF Retail Co
Performance |
| Timeline |
| Mgame Corp |
| BGF Retail |
Mgame Corp and BGF Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mgame Corp and BGF Retail
The main advantage of trading using opposite Mgame Corp and BGF Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mgame Corp position performs unexpectedly, BGF Retail 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 BGF Retail will offset losses from the drop in BGF Retail's long position.| Mgame Corp vs. AptaBio Therapeutics | Mgame Corp vs. Daewoo SBI SPAC | Mgame Corp vs. Dream Security co | Mgame Corp vs. Microfriend |
| BGF Retail vs. Korea Real Estate | BGF Retail vs. Korea Ratings Co | BGF Retail vs. IQuest Co | BGF Retail vs. Wonbang Tech Co |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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