Correlation Between MOVIE GAMES and Ares Management
Can any of the company-specific risk be diversified away by investing in both MOVIE GAMES and Ares Management 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 MOVIE GAMES and Ares Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOVIE GAMES SA and Ares Management Corp, you can compare the effects of market volatilities on MOVIE GAMES and Ares Management 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 MOVIE GAMES with a short position of Ares Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOVIE GAMES and Ares Management.
Diversification Opportunities for MOVIE GAMES and Ares Management
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MOVIE and Ares is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and Ares Management Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ares Management Corp and MOVIE GAMES 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 MOVIE GAMES SA are associated (or correlated) with Ares Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ares Management Corp has no effect on the direction of MOVIE GAMES i.e., MOVIE GAMES and Ares Management go up and down completely randomly.
Pair Corralation between MOVIE GAMES and Ares Management
Assuming the 90 days horizon MOVIE GAMES SA is expected to generate 3.23 times more return on investment than Ares Management. However, MOVIE GAMES is 3.23 times more volatile than Ares Management Corp. It trades about 0.07 of its potential returns per unit of risk. Ares Management Corp is currently generating about 0.11 per unit of risk. If you would invest 337.00 in MOVIE GAMES SA on October 11, 2024 and sell it today you would earn a total of 14.00 from holding MOVIE GAMES SA or generate 4.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOVIE GAMES SA vs. Ares Management Corp
Performance |
| Timeline |
| MOVIE GAMES SA |
| Ares Management Corp |
MOVIE GAMES and Ares Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOVIE GAMES and Ares Management
The main advantage of trading using opposite MOVIE GAMES and Ares Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES position performs unexpectedly, Ares Management 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 Ares Management will offset losses from the drop in Ares Management's long position.| MOVIE GAMES vs. Kingdee International Software | MOVIE GAMES vs. Uber Technologies | MOVIE GAMES vs. Harmony Gold Mining | MOVIE GAMES vs. SOFI TECHNOLOGIES |
| Ares Management vs. MOBILE FACTORY INC | Ares Management vs. SBM OFFSHORE | Ares Management vs. Tencent Music Entertainment | Ares Management vs. MOVIE GAMES SA |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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