Correlation Between International Game and FUTURE GAMING
Can any of the company-specific risk be diversified away by investing in both International Game and FUTURE GAMING 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 FUTURE GAMING 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 FUTURE GAMING GRP, you can compare the effects of market volatilities on International Game and FUTURE GAMING 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 FUTURE GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Game and FUTURE GAMING.
Diversification Opportunities for International Game and FUTURE GAMING
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between International and FUTURE is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding International Game Technology and FUTURE GAMING GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUTURE GAMING GRP 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 FUTURE GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUTURE GAMING GRP has no effect on the direction of International Game i.e., International Game and FUTURE GAMING go up and down completely randomly.
Pair Corralation between International Game and FUTURE GAMING
Assuming the 90 days horizon International Game Technology is expected to under-perform the FUTURE GAMING. But the stock apears to be less risky and, when comparing its historical volatility, International Game Technology is 1.07 times less risky than FUTURE GAMING. The stock trades about -0.11 of its potential returns per unit of risk. The FUTURE GAMING GRP is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 61.00 in FUTURE GAMING GRP on August 30, 2024 and sell it today you would earn a total of 2.00 from holding FUTURE GAMING GRP or generate 3.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
International Game Technology vs. FUTURE GAMING GRP
Performance |
| Timeline |
| International Game |
| FUTURE GAMING GRP |
International Game and FUTURE GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Game and FUTURE GAMING
The main advantage of trading using opposite International Game and FUTURE GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Game position performs unexpectedly, FUTURE GAMING 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 FUTURE GAMING will offset losses from the drop in FUTURE GAMING's long position.| International Game vs. Playa Hotels Resorts | International Game vs. Summit Hotel Properties | International Game vs. MELIA HOTELS | International Game vs. Platinum Investment Management |
| FUTURE GAMING vs. URBAN OUTFITTERS | FUTURE GAMING vs. WillScot Mobile Mini | FUTURE GAMING vs. Singapore Telecommunications Limited | FUTURE GAMING vs. Sixt Leasing SE |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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