Correlation Between TROPHY GAMES and General Mills
Can any of the company-specific risk be diversified away by investing in both TROPHY GAMES and General Mills 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 TROPHY GAMES and General Mills into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TROPHY GAMES DEV and General Mills, you can compare the effects of market volatilities on TROPHY GAMES and General Mills 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 TROPHY GAMES with a short position of General Mills. Check out your portfolio center. Please also check ongoing floating volatility patterns of TROPHY GAMES and General Mills.
Diversification Opportunities for TROPHY GAMES and General Mills
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TROPHY and General is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding TROPHY GAMES DEV and General Mills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Mills and TROPHY 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 TROPHY GAMES DEV are associated (or correlated) with General Mills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Mills has no effect on the direction of TROPHY GAMES i.e., TROPHY GAMES and General Mills go up and down completely randomly.
Pair Corralation between TROPHY GAMES and General Mills
Assuming the 90 days horizon TROPHY GAMES DEV is expected to under-perform the General Mills. In addition to that, TROPHY GAMES is 2.15 times more volatile than General Mills. It trades about -0.06 of its total potential returns per unit of risk. General Mills is currently generating about -0.12 per unit of volatility. If you would invest 6,606 in General Mills on August 25, 2024 and sell it today you would lose (393.00) from holding General Mills or give up 5.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TROPHY GAMES DEV vs. General Mills
Performance |
| Timeline |
| TROPHY GAMES DEV |
| General Mills |
TROPHY GAMES and General Mills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TROPHY GAMES and General Mills
The main advantage of trading using opposite TROPHY GAMES and General Mills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TROPHY GAMES position performs unexpectedly, General Mills 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 General Mills will offset losses from the drop in General Mills' long position.| TROPHY GAMES vs. Sea Limited | TROPHY GAMES vs. NEXON Co | TROPHY GAMES vs. Take Two Interactive Software | TROPHY GAMES vs. Bilibili |
| General Mills vs. JJ SNACK FOODS | General Mills vs. SENECA FOODS A | General Mills vs. PENN NATL GAMING | General Mills vs. TROPHY GAMES DEV |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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