Correlation Between Cembra Money and Guild Esports

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Cembra Money and Guild Esports 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 Cembra Money and Guild Esports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cembra Money Bank and Guild Esports Plc, you can compare the effects of market volatilities on Cembra Money and Guild Esports 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 Cembra Money with a short position of Guild Esports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cembra Money and Guild Esports.

Diversification Opportunities for Cembra Money and Guild Esports

-0.56
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Cembra and Guild is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Cembra Money Bank and Guild Esports Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guild Esports Plc and Cembra Money 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 Cembra Money Bank are associated (or correlated) with Guild Esports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guild Esports Plc has no effect on the direction of Cembra Money i.e., Cembra Money and Guild Esports go up and down completely randomly.

Pair Corralation between Cembra Money and Guild Esports

Assuming the 90 days trading horizon Cembra Money Bank is expected to generate 0.11 times more return on investment than Guild Esports. However, Cembra Money Bank is 9.3 times less risky than Guild Esports. It trades about 0.48 of its potential returns per unit of risk. Guild Esports Plc is currently generating about -0.03 per unit of risk. If you would invest  7,890  in Cembra Money Bank on September 13, 2024 and sell it today you would earn a total of  515.00  from holding Cembra Money Bank or generate 6.53% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Cembra Money Bank  vs.  Guild Esports Plc

 Performance 
       Timeline  
Cembra Money Bank 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Cembra Money Bank are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Cembra Money may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Guild Esports Plc 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Guild Esports Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Cembra Money and Guild Esports Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cembra Money and Guild Esports

The main advantage of trading using opposite Cembra Money and Guild Esports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cembra Money position performs unexpectedly, Guild Esports 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 Guild Esports will offset losses from the drop in Guild Esports' long position.
The idea behind Cembra Money Bank and Guild Esports Plc 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.
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

Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Insider Screener
Find insiders across different sectors to evaluate their impact on performance