Correlation Between GAMING FAC and RETAIL FOOD
Can any of the company-specific risk be diversified away by investing in both GAMING FAC and RETAIL FOOD 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 RETAIL FOOD 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 RETAIL FOOD GROUP, you can compare the effects of market volatilities on GAMING FAC and RETAIL FOOD 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 RETAIL FOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMING FAC and RETAIL FOOD.
Diversification Opportunities for GAMING FAC and RETAIL FOOD
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between GAMING and RETAIL is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding GAMING FAC SA and RETAIL FOOD GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RETAIL FOOD GROUP 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 RETAIL FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RETAIL FOOD GROUP has no effect on the direction of GAMING FAC i.e., GAMING FAC and RETAIL FOOD go up and down completely randomly.
Pair Corralation between GAMING FAC and RETAIL FOOD
Assuming the 90 days horizon GAMING FAC SA is expected to generate 1.14 times more return on investment than RETAIL FOOD. However, GAMING FAC is 1.14 times more volatile than RETAIL FOOD GROUP. It trades about 0.04 of its potential returns per unit of risk. RETAIL FOOD GROUP is currently generating about -0.04 per unit of risk. If you would invest 124.00 in GAMING FAC SA on October 17, 2024 and sell it today you would earn a total of 53.00 from holding GAMING FAC SA or generate 42.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
GAMING FAC SA vs. RETAIL FOOD GROUP
Performance |
| Timeline |
| GAMING FAC SA |
| RETAIL FOOD GROUP |
GAMING FAC and RETAIL FOOD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMING FAC and RETAIL FOOD
The main advantage of trading using opposite GAMING FAC and RETAIL FOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMING FAC position performs unexpectedly, RETAIL FOOD 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 RETAIL FOOD will offset losses from the drop in RETAIL FOOD's long position.| GAMING FAC vs. AGF Management Limited | GAMING FAC vs. Cleanaway Waste Management | GAMING FAC vs. Perdoceo Education | GAMING FAC vs. Jupiter Fund Management |
| RETAIL FOOD vs. GAMING FAC SA | RETAIL FOOD vs. PLAYMATES TOYS | RETAIL FOOD vs. DIVERSIFIED ROYALTY | RETAIL FOOD vs. CHRYSALIS INVESTMENTS LTD |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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