Correlation Between CD PROJEKT and GI Group
Can any of the company-specific risk be diversified away by investing in both CD PROJEKT and GI Group 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 CD PROJEKT and GI Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CD PROJEKT SA and GI Group Poland, you can compare the effects of market volatilities on CD PROJEKT and GI Group 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 CD PROJEKT with a short position of GI Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CD PROJEKT and GI Group.
Diversification Opportunities for CD PROJEKT and GI Group
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CDR and GIG is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding CD PROJEKT SA and GI Group Poland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GI Group Poland and CD PROJEKT 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 CD PROJEKT SA are associated (or correlated) with GI Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GI Group Poland has no effect on the direction of CD PROJEKT i.e., CD PROJEKT and GI Group go up and down completely randomly.
Pair Corralation between CD PROJEKT and GI Group
Assuming the 90 days trading horizon CD PROJEKT SA is expected to generate 1.09 times more return on investment than GI Group. However, CD PROJEKT is 1.09 times more volatile than GI Group Poland. It trades about 0.1 of its potential returns per unit of risk. GI Group Poland is currently generating about 0.01 per unit of risk. If you would invest 10,747 in CD PROJEKT SA on September 2, 2024 and sell it today you would earn a total of 5,973 from holding CD PROJEKT SA or generate 55.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CD PROJEKT SA vs. GI Group Poland
Performance |
| Timeline |
| CD PROJEKT SA |
| GI Group Poland |
CD PROJEKT and GI Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CD PROJEKT and GI Group
The main advantage of trading using opposite CD PROJEKT and GI Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CD PROJEKT position performs unexpectedly, GI Group 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 GI Group will offset losses from the drop in GI Group's long position.| CD PROJEKT vs. LPP SA | CD PROJEKT vs. Stalprodukt SA | CD PROJEKT vs. mBank SA | CD PROJEKT vs. Santander Bank Polska |
| GI Group vs. Echo Investment SA | GI Group vs. Esotiq Henderson SA | GI Group vs. Asseco South Eastern | GI Group vs. Vercom 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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