Correlation Between FUTURE GAMING and Algonquin Power
Can any of the company-specific risk be diversified away by investing in both FUTURE GAMING and Algonquin Power 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 FUTURE GAMING and Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FUTURE GAMING GRP and Algonquin Power Utilities, you can compare the effects of market volatilities on FUTURE GAMING and Algonquin Power 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 FUTURE GAMING with a short position of Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of FUTURE GAMING and Algonquin Power.
Diversification Opportunities for FUTURE GAMING and Algonquin Power
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FUTURE and Algonquin is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding FUTURE GAMING GRP and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities and FUTURE 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 FUTURE GAMING GRP are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of FUTURE GAMING i.e., FUTURE GAMING and Algonquin Power go up and down completely randomly.
Pair Corralation between FUTURE GAMING and Algonquin Power
Assuming the 90 days trading horizon FUTURE GAMING GRP is expected to under-perform the Algonquin Power. In addition to that, FUTURE GAMING is 3.18 times more volatile than Algonquin Power Utilities. It trades about -0.08 of its total potential returns per unit of risk. Algonquin Power Utilities is currently generating about -0.08 per unit of volatility. If you would invest 443.00 in Algonquin Power Utilities on September 14, 2024 and sell it today you would lose (13.00) from holding Algonquin Power Utilities or give up 2.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FUTURE GAMING GRP vs. Algonquin Power Utilities
Performance |
| Timeline |
| FUTURE GAMING GRP |
| Algonquin Power Utilities |
FUTURE GAMING and Algonquin Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FUTURE GAMING and Algonquin Power
The main advantage of trading using opposite FUTURE GAMING and Algonquin Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FUTURE GAMING position performs unexpectedly, Algonquin Power 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 Algonquin Power will offset losses from the drop in Algonquin Power's long position.| FUTURE GAMING vs. Scientific Games | FUTURE GAMING vs. International Game Technology | FUTURE GAMING vs. Superior Plus Corp | FUTURE GAMING vs. SIVERS SEMICONDUCTORS AB |
| Algonquin Power vs. Superior Plus Corp | Algonquin Power vs. SIVERS SEMICONDUCTORS AB | Algonquin Power vs. Norsk Hydro ASA | Algonquin Power vs. Reliance Steel Aluminum |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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