Correlation Between MOVIE GAMES and X FAB
Can any of the company-specific risk be diversified away by investing in both MOVIE GAMES and X FAB 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 X FAB 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 X FAB Silicon Foundries, you can compare the effects of market volatilities on MOVIE GAMES and X FAB 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 X FAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOVIE GAMES and X FAB.
Diversification Opportunities for MOVIE GAMES and X FAB
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between MOVIE and XFB is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and X FAB Silicon Foundries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X FAB Silicon 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 X FAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X FAB Silicon has no effect on the direction of MOVIE GAMES i.e., MOVIE GAMES and X FAB go up and down completely randomly.
Pair Corralation between MOVIE GAMES and X FAB
Assuming the 90 days horizon MOVIE GAMES SA is expected to generate 1.66 times more return on investment than X FAB. However, MOVIE GAMES is 1.66 times more volatile than X FAB Silicon Foundries. It trades about 0.13 of its potential returns per unit of risk. X FAB Silicon Foundries is currently generating about 0.03 per unit of risk. If you would invest 378.00 in MOVIE GAMES SA on November 3, 2024 and sell it today you would earn a total of 42.00 from holding MOVIE GAMES SA or generate 11.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
MOVIE GAMES SA vs. X FAB Silicon Foundries
Performance |
| Timeline |
| MOVIE GAMES SA |
| X FAB Silicon |
MOVIE GAMES and X FAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOVIE GAMES and X FAB
The main advantage of trading using opposite MOVIE GAMES and X FAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES position performs unexpectedly, X FAB 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 X FAB will offset losses from the drop in X FAB's long position.| MOVIE GAMES vs. THAI BEVERAGE | MOVIE GAMES vs. China Resources Beer | MOVIE GAMES vs. Cairo Communication SpA | MOVIE GAMES vs. Highlight Communications AG |
| X FAB vs. SIVERS SEMICONDUCTORS AB | X FAB vs. NorAm Drilling AS | X FAB vs. Volkswagen AG | X FAB vs. Darden Restaurants |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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