Correlation Between GAMING FAC and BASF SE
Can any of the company-specific risk be diversified away by investing in both GAMING FAC and BASF SE 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 GAMING FAC and BASF SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMING FAC SA and BASF SE, you can compare the effects of market volatilities on GAMING FAC and BASF SE 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 GAMING FAC with a short position of BASF SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMING FAC and BASF SE.
Diversification Opportunities for GAMING FAC and BASF SE
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between GAMING and BASF is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding GAMING FAC SA and BASF SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASF SE and GAMING FAC 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 GAMING FAC SA are associated (or correlated) with BASF SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASF SE has no effect on the direction of GAMING FAC i.e., GAMING FAC and BASF SE go up and down completely randomly.
Pair Corralation between GAMING FAC and BASF SE
Assuming the 90 days horizon GAMING FAC SA is expected to generate 2.43 times more return on investment than BASF SE. However, GAMING FAC is 2.43 times more volatile than BASF SE. It trades about -0.04 of its potential returns per unit of risk. BASF SE is currently generating about -0.11 per unit of risk. If you would invest 174.00 in GAMING FAC SA on September 1, 2024 and sell it today you would lose (11.00) from holding GAMING FAC SA or give up 6.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMING FAC SA vs. BASF SE
Performance |
| Timeline |
| GAMING FAC SA |
| BASF SE |
GAMING FAC and BASF SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMING FAC and BASF SE
The main advantage of trading using opposite GAMING FAC and BASF SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMING FAC position performs unexpectedly, BASF SE 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 BASF SE will offset losses from the drop in BASF SE's long position.| GAMING FAC vs. Computer And Technologies | GAMING FAC vs. Haier Smart Home | GAMING FAC vs. Neinor Homes SA | GAMING FAC vs. bet at home AG |
| BASF SE vs. ARDAGH METAL PACDL 0001 | BASF SE vs. FIREWEED METALS P | BASF SE vs. NEWELL RUBBERMAID | BASF SE vs. SIMS METAL MGT |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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