Correlation Between Alfa Financial and Take Two
Can any of the company-specific risk be diversified away by investing in both Alfa Financial and Take Two 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 Alfa Financial and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Financial Software and Take Two Interactive Software, you can compare the effects of market volatilities on Alfa Financial and Take Two 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 Alfa Financial with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and Take Two.
Diversification Opportunities for Alfa Financial and Take Two
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alfa and Take is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and Alfa Financial 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 Alfa Financial Software are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of Alfa Financial i.e., Alfa Financial and Take Two go up and down completely randomly.
Pair Corralation between Alfa Financial and Take Two
Assuming the 90 days trading horizon Alfa Financial is expected to generate 1.01 times less return on investment than Take Two. In addition to that, Alfa Financial is 1.36 times more volatile than Take Two Interactive Software. It trades about 0.15 of its total potential returns per unit of risk. Take Two Interactive Software is currently generating about 0.21 per unit of volatility. If you would invest 14,482 in Take Two Interactive Software on August 31, 2024 and sell it today you would earn a total of 3,258 from holding Take Two Interactive Software or generate 22.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alfa Financial Software vs. Take Two Interactive Software
Performance |
| Timeline |
| Alfa Financial Software |
| Take Two Interactive |
Alfa Financial and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfa Financial and Take Two
The main advantage of trading using opposite Alfa Financial and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Financial position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| Alfa Financial vs. Texas Roadhouse | Alfa Financial vs. G III Apparel Group | Alfa Financial vs. Transport International Holdings | Alfa Financial vs. GOLD ROAD RES |
| Take Two vs. Playa Hotels Resorts | Take Two vs. Tencent Music Entertainment | Take Two vs. Universal Entertainment | Take Two vs. PLAYTIKA HOLDING DL 01 |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |