Correlation Between FRACTAL GAMING and Japan Tobacco
Can any of the company-specific risk be diversified away by investing in both FRACTAL GAMING and Japan Tobacco 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 FRACTAL GAMING and Japan Tobacco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FRACTAL GAMING GROUP and Japan Tobacco, you can compare the effects of market volatilities on FRACTAL GAMING and Japan Tobacco 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 FRACTAL GAMING with a short position of Japan Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRACTAL GAMING and Japan Tobacco.
Diversification Opportunities for FRACTAL GAMING and Japan Tobacco
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between FRACTAL and Japan is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding FRACTAL GAMING GROUP and Japan Tobacco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Tobacco and FRACTAL GAMING 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 FRACTAL GAMING GROUP are associated (or correlated) with Japan Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Tobacco has no effect on the direction of FRACTAL GAMING i.e., FRACTAL GAMING and Japan Tobacco go up and down completely randomly.
Pair Corralation between FRACTAL GAMING and Japan Tobacco
Assuming the 90 days horizon FRACTAL GAMING GROUP is expected to under-perform the Japan Tobacco. But the stock apears to be less risky and, when comparing its historical volatility, FRACTAL GAMING GROUP is 1.15 times less risky than Japan Tobacco. The stock trades about -0.24 of its potential returns per unit of risk. The Japan Tobacco is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,536 in Japan Tobacco on September 12, 2024 and sell it today you would earn a total of 114.00 from holding Japan Tobacco or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FRACTAL GAMING GROUP vs. Japan Tobacco
Performance |
| Timeline |
| FRACTAL GAMING GROUP |
| Japan Tobacco |
FRACTAL GAMING and Japan Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FRACTAL GAMING and Japan Tobacco
The main advantage of trading using opposite FRACTAL GAMING and Japan Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FRACTAL GAMING position performs unexpectedly, Japan Tobacco 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 Japan Tobacco will offset losses from the drop in Japan Tobacco's long position.| FRACTAL GAMING vs. Corsair Gaming | FRACTAL GAMING vs. Datalogic SpA | FRACTAL GAMING vs. Superior Plus Corp | FRACTAL GAMING vs. SIVERS SEMICONDUCTORS AB |
| Japan Tobacco vs. TEXAS ROADHOUSE | Japan Tobacco vs. COPLAND ROAD CAPITAL | Japan Tobacco vs. QUEEN S ROAD | Japan Tobacco vs. Kaufman Broad 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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