Correlation Between Electronic Arts and Weiss Korea
Can any of the company-specific risk be diversified away by investing in both Electronic Arts and Weiss Korea 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 Electronic Arts and Weiss Korea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronic Arts and Weiss Korea Opportunity, you can compare the effects of market volatilities on Electronic Arts and Weiss Korea 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 Electronic Arts with a short position of Weiss Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronic Arts and Weiss Korea.
Diversification Opportunities for Electronic Arts and Weiss Korea
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electronic and Weiss is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Electronic Arts and Weiss Korea Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weiss Korea Opportunity and Electronic Arts 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 Electronic Arts are associated (or correlated) with Weiss Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weiss Korea Opportunity has no effect on the direction of Electronic Arts i.e., Electronic Arts and Weiss Korea go up and down completely randomly.
Pair Corralation between Electronic Arts and Weiss Korea
Assuming the 90 days trading horizon Electronic Arts is expected to generate 1.08 times more return on investment than Weiss Korea. However, Electronic Arts is 1.08 times more volatile than Weiss Korea Opportunity. It trades about 0.06 of its potential returns per unit of risk. Weiss Korea Opportunity is currently generating about -0.03 per unit of risk. If you would invest 11,985 in Electronic Arts on September 12, 2024 and sell it today you would earn a total of 4,638 from holding Electronic Arts or generate 38.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Electronic Arts vs. Weiss Korea Opportunity
Performance |
| Timeline |
| Electronic Arts |
| Weiss Korea Opportunity |
Electronic Arts and Weiss Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronic Arts and Weiss Korea
The main advantage of trading using opposite Electronic Arts and Weiss Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronic Arts position performs unexpectedly, Weiss Korea 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 Weiss Korea will offset losses from the drop in Weiss Korea's long position.| Electronic Arts vs. Hong Kong Land | Electronic Arts vs. Neometals | Electronic Arts vs. Coor Service Management | Electronic Arts vs. Fidelity Sustainable USD |
| Weiss Korea vs. Samsung Electronics Co | Weiss Korea vs. Samsung Electronics Co | Weiss Korea vs. Hyundai Motor | Weiss Korea vs. Toyota Motor Corp |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |