Correlation Between Inter Cars and True Games
Can any of the company-specific risk be diversified away by investing in both Inter Cars and True Games 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 Inter Cars and True Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inter Cars SA and True Games Syndicate, you can compare the effects of market volatilities on Inter Cars and True Games 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 Inter Cars with a short position of True Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inter Cars and True Games.
Diversification Opportunities for Inter Cars and True Games
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Inter and True is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Inter Cars SA and True Games Syndicate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on True Games Syndicate and Inter Cars 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 Inter Cars SA are associated (or correlated) with True Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of True Games Syndicate has no effect on the direction of Inter Cars i.e., Inter Cars and True Games go up and down completely randomly.
Pair Corralation between Inter Cars and True Games
Assuming the 90 days trading horizon Inter Cars SA is expected to generate 0.28 times more return on investment than True Games. However, Inter Cars SA is 3.62 times less risky than True Games. It trades about 0.19 of its potential returns per unit of risk. True Games Syndicate is currently generating about 0.03 per unit of risk. If you would invest 48,250 in Inter Cars SA on September 14, 2024 and sell it today you would earn a total of 3,350 from holding Inter Cars SA or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Inter Cars SA vs. True Games Syndicate
Performance |
| Timeline |
| Inter Cars SA |
| True Games Syndicate |
Inter Cars and True Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inter Cars and True Games
The main advantage of trading using opposite Inter Cars and True Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inter Cars position performs unexpectedly, True Games 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 True Games will offset losses from the drop in True Games' long position.| Inter Cars vs. Banco Santander SA | Inter Cars vs. UniCredit SpA | Inter Cars vs. CEZ as | Inter Cars vs. Polski Koncern Naftowy |
| True Games vs. Gamedust SA | True Games vs. Quantum Software SA | True Games vs. MW Trade SA | True Games vs. Inter Cars SA |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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