Correlation Between Ping An and GAMESTOP
Can any of the company-specific risk be diversified away by investing in both Ping An and GAMESTOP 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 Ping An and GAMESTOP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Healthcare and GAMESTOP, you can compare the effects of market volatilities on Ping An and GAMESTOP 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 Ping An with a short position of GAMESTOP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and GAMESTOP.
Diversification Opportunities for Ping An and GAMESTOP
Poor diversification
The 3 months correlation between Ping and GAMESTOP is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Healthcare and GAMESTOP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMESTOP and Ping An 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 Ping An Healthcare are associated (or correlated) with GAMESTOP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMESTOP has no effect on the direction of Ping An i.e., Ping An and GAMESTOP go up and down completely randomly.
Pair Corralation between Ping An and GAMESTOP
Assuming the 90 days horizon Ping An is expected to generate 1.05 times less return on investment than GAMESTOP. In addition to that, Ping An is 1.26 times more volatile than GAMESTOP. It trades about 0.25 of its total potential returns per unit of risk. GAMESTOP is currently generating about 0.33 per unit of volatility. If you would invest 2,055 in GAMESTOP on September 2, 2024 and sell it today you would earn a total of 647.00 from holding GAMESTOP or generate 31.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Healthcare vs. GAMESTOP
Performance |
| Timeline |
| Ping An Healthcare |
| GAMESTOP |
Ping An and GAMESTOP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and GAMESTOP
The main advantage of trading using opposite Ping An and GAMESTOP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, GAMESTOP 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 GAMESTOP will offset losses from the drop in GAMESTOP's long position.| Ping An vs. GAMESTOP | Ping An vs. Waste Management | Ping An vs. Coor Service Management | Ping An vs. Games Workshop Group |
| GAMESTOP vs. SIVERS SEMICONDUCTORS AB | GAMESTOP vs. Darden Restaurants | GAMESTOP vs. Reliance Steel Aluminum | GAMESTOP vs. Q2M Managementberatung AG |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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