Correlation Between GAMING FAC and Nintendo
Can any of the company-specific risk be diversified away by investing in both GAMING FAC and Nintendo 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 Nintendo 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 Nintendo Co, you can compare the effects of market volatilities on GAMING FAC and Nintendo 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 Nintendo. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMING FAC and Nintendo.
Diversification Opportunities for GAMING FAC and Nintendo
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GAMING and Nintendo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding GAMING FAC SA and Nintendo Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nintendo 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 Nintendo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nintendo has no effect on the direction of GAMING FAC i.e., GAMING FAC and Nintendo go up and down completely randomly.
Pair Corralation between GAMING FAC and Nintendo
Assuming the 90 days horizon GAMING FAC SA is expected to under-perform the Nintendo. In addition to that, GAMING FAC is 1.65 times more volatile than Nintendo Co. It trades about -0.06 of its total potential returns per unit of risk. Nintendo Co is currently generating about 0.05 per unit of volatility. If you would invest 4,621 in Nintendo Co on September 3, 2024 and sell it today you would earn a total of 823.00 from holding Nintendo Co or generate 17.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMING FAC SA vs. Nintendo Co
Performance |
| Timeline |
| GAMING FAC SA |
| Nintendo |
GAMING FAC and Nintendo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMING FAC and Nintendo
The main advantage of trading using opposite GAMING FAC and Nintendo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMING FAC position performs unexpectedly, Nintendo 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 Nintendo will offset losses from the drop in Nintendo's long position.| GAMING FAC vs. Nintendo Co | GAMING FAC vs. Nintendo Co | GAMING FAC vs. Sea Limited | GAMING FAC vs. Take Two Interactive Software |
| Nintendo vs. AOI Electronics Co | Nintendo vs. ARROW ELECTRONICS | Nintendo vs. BYD ELECTRONIC | Nintendo vs. Arrow Electronics |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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