Correlation Between FUTURE GAMING and UNITED UTILITIES
Can any of the company-specific risk be diversified away by investing in both FUTURE GAMING and UNITED UTILITIES 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 UNITED UTILITIES 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 UNITED UTILITIES GR, you can compare the effects of market volatilities on FUTURE GAMING and UNITED UTILITIES 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 UNITED UTILITIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of FUTURE GAMING and UNITED UTILITIES.
Diversification Opportunities for FUTURE GAMING and UNITED UTILITIES
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FUTURE and UNITED is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding FUTURE GAMING GRP and UNITED UTILITIES GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED 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 UNITED UTILITIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED UTILITIES has no effect on the direction of FUTURE GAMING i.e., FUTURE GAMING and UNITED UTILITIES go up and down completely randomly.
Pair Corralation between FUTURE GAMING and UNITED UTILITIES
Assuming the 90 days trading horizon FUTURE GAMING GRP is expected to under-perform the UNITED UTILITIES. In addition to that, FUTURE GAMING is 3.51 times more volatile than UNITED UTILITIES GR. It trades about -0.08 of its total potential returns per unit of risk. UNITED UTILITIES GR is currently generating about 0.16 per unit of volatility. If you would invest 1,234 in UNITED UTILITIES GR on September 14, 2024 and sell it today you would earn a total of 56.00 from holding UNITED UTILITIES GR or generate 4.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FUTURE GAMING GRP vs. UNITED UTILITIES GR
Performance |
| Timeline |
| FUTURE GAMING GRP |
| UNITED UTILITIES |
FUTURE GAMING and UNITED UTILITIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FUTURE GAMING and UNITED UTILITIES
The main advantage of trading using opposite FUTURE GAMING and UNITED UTILITIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FUTURE GAMING position performs unexpectedly, UNITED UTILITIES 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 UNITED UTILITIES will offset losses from the drop in UNITED UTILITIES'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 |
| UNITED UTILITIES vs. National Retail Properties | UNITED UTILITIES vs. QURATE RETAIL INC | UNITED UTILITIES vs. Sumitomo Rubber Industries | UNITED UTILITIES vs. GOODYEAR T RUBBER |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |