Correlation Between International Game and Prosus NV
Can any of the company-specific risk be diversified away by investing in both International Game and Prosus NV 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 International Game and Prosus NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Game Technology and Prosus NV, you can compare the effects of market volatilities on International Game and Prosus NV 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 International Game with a short position of Prosus NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Game and Prosus NV.
Diversification Opportunities for International Game and Prosus NV
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between International and Prosus is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding International Game Technology and Prosus NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosus NV and International Game 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 International Game Technology are associated (or correlated) with Prosus NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosus NV has no effect on the direction of International Game i.e., International Game and Prosus NV go up and down completely randomly.
Pair Corralation between International Game and Prosus NV
Assuming the 90 days horizon International Game Technology is expected to under-perform the Prosus NV. In addition to that, International Game is 1.96 times more volatile than Prosus NV. It trades about -0.15 of its total potential returns per unit of risk. Prosus NV is currently generating about 0.29 per unit of volatility. If you would invest 3,780 in Prosus NV on September 13, 2024 and sell it today you would earn a total of 264.00 from holding Prosus NV or generate 6.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Game Technology vs. Prosus NV
Performance |
| Timeline |
| International Game |
| Prosus NV |
International Game and Prosus NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Game and Prosus NV
The main advantage of trading using opposite International Game and Prosus NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Game position performs unexpectedly, Prosus NV 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 Prosus NV will offset losses from the drop in Prosus NV's long position.| International Game vs. Scientific Games | International Game vs. Superior Plus Corp | International Game vs. SIVERS SEMICONDUCTORS AB | International Game vs. NorAm Drilling AS |
| Prosus NV vs. Gladstone Investment | Prosus NV vs. PT Bank Maybank | Prosus NV vs. SEI INVESTMENTS | Prosus NV vs. Apollo Investment Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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