Correlation Between Altair Engineering and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Altair Engineering and Electronic Arts 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 Altair Engineering and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altair Engineering and Electronic Arts, you can compare the effects of market volatilities on Altair Engineering and Electronic Arts 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 Altair Engineering with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altair Engineering and Electronic Arts.
Diversification Opportunities for Altair Engineering and Electronic Arts
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Altair and Electronic is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Altair Engineering and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Altair Engineering 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 Altair Engineering are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Altair Engineering i.e., Altair Engineering and Electronic Arts go up and down completely randomly.
Pair Corralation between Altair Engineering and Electronic Arts
Assuming the 90 days horizon Altair Engineering is expected to generate 0.71 times more return on investment than Electronic Arts. However, Altair Engineering is 1.4 times less risky than Electronic Arts. It trades about 0.53 of its potential returns per unit of risk. Electronic Arts is currently generating about -0.39 per unit of risk. If you would invest 10,100 in Altair Engineering on October 15, 2024 and sell it today you would earn a total of 600.00 from holding Altair Engineering or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altair Engineering vs. Electronic Arts
Performance |
| Timeline |
| Altair Engineering |
| Electronic Arts |
Altair Engineering and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altair Engineering and Electronic Arts
The main advantage of trading using opposite Altair Engineering and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altair Engineering position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Altair Engineering vs. PACIFIC ONLINE | Altair Engineering vs. SLR Investment Corp | Altair Engineering vs. FIRST SAVINGS FINL | Altair Engineering vs. Gruppo Mutuionline SpA |
| Electronic Arts vs. CHINA SOUTHN AIR H | Electronic Arts vs. Compugroup Medical SE | Electronic Arts vs. Altair Engineering | Electronic Arts vs. SYSTEMAIR AB |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Stocks Directory Find actively traded stocks across global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Transaction History View history of all your transactions and understand their impact on performance |