Correlation Between Alpha Esports and GameSquare Holdings
Can any of the company-specific risk be diversified away by investing in both Alpha Esports and GameSquare Holdings 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 Alpha Esports and GameSquare Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpha Esports Tech and GameSquare Holdings, you can compare the effects of market volatilities on Alpha Esports and GameSquare Holdings 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 Alpha Esports with a short position of GameSquare Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Esports and GameSquare Holdings.
Diversification Opportunities for Alpha Esports and GameSquare Holdings
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alpha and GameSquare is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Esports Tech and GameSquare Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GameSquare Holdings and Alpha Esports 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 Alpha Esports Tech are associated (or correlated) with GameSquare Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GameSquare Holdings has no effect on the direction of Alpha Esports i.e., Alpha Esports and GameSquare Holdings go up and down completely randomly.
Pair Corralation between Alpha Esports and GameSquare Holdings
Assuming the 90 days horizon Alpha Esports Tech is expected to under-perform the GameSquare Holdings. In addition to that, Alpha Esports is 4.09 times more volatile than GameSquare Holdings. It trades about -0.14 of its total potential returns per unit of risk. GameSquare Holdings is currently generating about 0.08 per unit of volatility. If you would invest 85.00 in GameSquare Holdings on November 9, 2024 and sell it today you would earn a total of 4.00 from holding GameSquare Holdings or generate 4.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alpha Esports Tech vs. GameSquare Holdings
Performance |
| Timeline |
| Alpha Esports Tech |
| GameSquare Holdings |
Alpha Esports and GameSquare Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alpha Esports and GameSquare Holdings
The main advantage of trading using opposite Alpha Esports and GameSquare Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha Esports position performs unexpectedly, GameSquare Holdings 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 GameSquare Holdings will offset losses from the drop in GameSquare Holdings' long position.The idea behind Alpha Esports Tech and GameSquare Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| GameSquare Holdings vs. Doubledown Interactive Co | GameSquare Holdings vs. Snail, Class A | GameSquare Holdings vs. Golden Matrix Group | GameSquare Holdings vs. SohuCom |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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