Correlation Between Creativeforge Games and Enea SA
Can any of the company-specific risk be diversified away by investing in both Creativeforge Games and Enea SA 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 Creativeforge Games and Enea SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Creativeforge Games SA and Enea SA, you can compare the effects of market volatilities on Creativeforge Games and Enea SA 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 Creativeforge Games with a short position of Enea SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creativeforge Games and Enea SA.
Diversification Opportunities for Creativeforge Games and Enea SA
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Creativeforge and Enea is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Creativeforge Games SA and Enea SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enea SA and Creativeforge Games 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 Creativeforge Games SA are associated (or correlated) with Enea SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enea SA has no effect on the direction of Creativeforge Games i.e., Creativeforge Games and Enea SA go up and down completely randomly.
Pair Corralation between Creativeforge Games and Enea SA
Assuming the 90 days trading horizon Creativeforge Games SA is expected to generate 2.5 times more return on investment than Enea SA. However, Creativeforge Games is 2.5 times more volatile than Enea SA. It trades about 0.14 of its potential returns per unit of risk. Enea SA is currently generating about 0.06 per unit of risk. If you would invest 205.00 in Creativeforge Games SA on December 8, 2024 and sell it today you would earn a total of 16.00 from holding Creativeforge Games SA or generate 7.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Creativeforge Games SA vs. Enea SA
Performance |
| Timeline |
| Creativeforge Games |
| Enea SA |
Creativeforge Games and Enea SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creativeforge Games and Enea SA
The main advantage of trading using opposite Creativeforge Games and Enea SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creativeforge Games position performs unexpectedly, Enea SA 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 Enea SA will offset losses from the drop in Enea SA's long position.| Creativeforge Games vs. Inter Cars SA | ||
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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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