Correlation Between Ibase Gaming and Data International
Can any of the company-specific risk be diversified away by investing in both Ibase Gaming and Data International 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 Ibase Gaming and Data International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ibase Gaming and Data International Co, you can compare the effects of market volatilities on Ibase Gaming and Data International 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 Ibase Gaming with a short position of Data International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ibase Gaming and Data International.
Diversification Opportunities for Ibase Gaming and Data International
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ibase and Data is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ibase Gaming and Data International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data International and Ibase 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 Ibase Gaming are associated (or correlated) with Data International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data International has no effect on the direction of Ibase Gaming i.e., Ibase Gaming and Data International go up and down completely randomly.
Pair Corralation between Ibase Gaming and Data International
Assuming the 90 days trading horizon Ibase Gaming is expected to under-perform the Data International. But the stock apears to be less risky and, when comparing its historical volatility, Ibase Gaming is 1.64 times less risky than Data International. The stock trades about -0.04 of its potential returns per unit of risk. The Data International Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 12,550 in Data International Co on September 14, 2024 and sell it today you would earn a total of 3,400 from holding Data International Co or generate 27.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ibase Gaming vs. Data International Co
Performance |
| Timeline |
| Ibase Gaming |
| Data International |
Ibase Gaming and Data International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ibase Gaming and Data International
The main advantage of trading using opposite Ibase Gaming and Data International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ibase Gaming position performs unexpectedly, Data International 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 Data International will offset losses from the drop in Data International's long position.| Ibase Gaming vs. WIN Semiconductors | Ibase Gaming vs. GlobalWafers Co | Ibase Gaming vs. Novatek Microelectronics Corp | Ibase Gaming vs. Ruentex Development Co |
| Data International vs. ANJI Technology Co | Data International vs. Emerging Display Technologies | Data International vs. U Tech Media Corp | Data International vs. Ruentex Development Co |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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