Correlation Between TROPHY GAMES and Sabra Health
Can any of the company-specific risk be diversified away by investing in both TROPHY GAMES and Sabra Health 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 Sabra Health 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 Sabra Health Care, you can compare the effects of market volatilities on TROPHY GAMES and Sabra Health 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 Sabra Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of TROPHY GAMES and Sabra Health.
Diversification Opportunities for TROPHY GAMES and Sabra Health
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between TROPHY and Sabra is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding TROPHY GAMES DEV and Sabra Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra Health Care 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 Sabra Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Health Care has no effect on the direction of TROPHY GAMES i.e., TROPHY GAMES and Sabra Health go up and down completely randomly.
Pair Corralation between TROPHY GAMES and Sabra Health
Assuming the 90 days horizon TROPHY GAMES DEV is expected to generate 2.76 times more return on investment than Sabra Health. However, TROPHY GAMES is 2.76 times more volatile than Sabra Health Care. It trades about 0.05 of its potential returns per unit of risk. Sabra Health Care is currently generating about 0.08 per unit of risk. If you would invest 52.00 in TROPHY GAMES DEV on September 3, 2024 and sell it today you would earn a total of 39.00 from holding TROPHY GAMES DEV or generate 75.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TROPHY GAMES DEV vs. Sabra Health Care
Performance |
| Timeline |
| TROPHY GAMES DEV |
| Sabra Health Care |
TROPHY GAMES and Sabra Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TROPHY GAMES and Sabra Health
The main advantage of trading using opposite TROPHY GAMES and Sabra Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TROPHY GAMES position performs unexpectedly, Sabra Health 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 Sabra Health will offset losses from the drop in Sabra Health's long position.| TROPHY GAMES vs. Nintendo Co | TROPHY GAMES vs. Nintendo Co | TROPHY GAMES vs. Sea Limited | TROPHY GAMES vs. Take Two Interactive Software |
| Sabra Health vs. THAI BEVERAGE | Sabra Health vs. Lifeway Foods | Sabra Health vs. Cal Maine Foods | Sabra Health vs. SENECA FOODS A |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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