Correlation Between MOVIE GAMES and CSL
Can any of the company-specific risk be diversified away by investing in both MOVIE GAMES and CSL 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 CSL 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 CSL LTD SPONADR, you can compare the effects of market volatilities on MOVIE GAMES and CSL 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 CSL. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOVIE GAMES and CSL.
Diversification Opportunities for MOVIE GAMES and CSL
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MOVIE and CSL is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and CSL LTD SPONADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSL LTD SPONADR 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 CSL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSL LTD SPONADR has no effect on the direction of MOVIE GAMES i.e., MOVIE GAMES and CSL go up and down completely randomly.
Pair Corralation between MOVIE GAMES and CSL
Assuming the 90 days horizon MOVIE GAMES SA is expected to generate 2.69 times more return on investment than CSL. However, MOVIE GAMES is 2.69 times more volatile than CSL LTD SPONADR. It trades about 0.0 of its potential returns per unit of risk. CSL LTD SPONADR is currently generating about -0.01 per unit of risk. If you would invest 534.00 in MOVIE GAMES SA on October 15, 2024 and sell it today you would lose (133.00) from holding MOVIE GAMES SA or give up 24.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOVIE GAMES SA vs. CSL LTD SPONADR
Performance |
| Timeline |
| MOVIE GAMES SA |
| CSL LTD SPONADR |
MOVIE GAMES and CSL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOVIE GAMES and CSL
The main advantage of trading using opposite MOVIE GAMES and CSL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES position performs unexpectedly, CSL 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 CSL will offset losses from the drop in CSL's long position.| MOVIE GAMES vs. PT Steel Pipe | MOVIE GAMES vs. TOMBADOR IRON LTD | MOVIE GAMES vs. Nippon Steel | MOVIE GAMES vs. ONWARD MEDICAL BV |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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