Correlation Between Creativeforge Games and SOFTWARE MANSION
Can any of the company-specific risk be diversified away by investing in both Creativeforge Games and SOFTWARE MANSION 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 SOFTWARE MANSION 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 SOFTWARE MANSION SPOLKA, you can compare the effects of market volatilities on Creativeforge Games and SOFTWARE MANSION 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 SOFTWARE MANSION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creativeforge Games and SOFTWARE MANSION.
Diversification Opportunities for Creativeforge Games and SOFTWARE MANSION
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Creativeforge and SOFTWARE is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Creativeforge Games SA and SOFTWARE MANSION SPOLKA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOFTWARE MANSION SPOLKA 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 SOFTWARE MANSION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOFTWARE MANSION SPOLKA has no effect on the direction of Creativeforge Games i.e., Creativeforge Games and SOFTWARE MANSION go up and down completely randomly.
Pair Corralation between Creativeforge Games and SOFTWARE MANSION
Assuming the 90 days trading horizon Creativeforge Games SA is expected to under-perform the SOFTWARE MANSION. In addition to that, Creativeforge Games is 2.33 times more volatile than SOFTWARE MANSION SPOLKA. It trades about -0.11 of its total potential returns per unit of risk. SOFTWARE MANSION SPOLKA is currently generating about 0.0 per unit of volatility. If you would invest 3,190 in SOFTWARE MANSION SPOLKA on September 3, 2024 and sell it today you would lose (50.00) from holding SOFTWARE MANSION SPOLKA or give up 1.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.16% |
| Values | Daily Returns |
Creativeforge Games SA vs. SOFTWARE MANSION SPOLKA
Performance |
| Timeline |
| Creativeforge Games |
| SOFTWARE MANSION SPOLKA |
Creativeforge Games and SOFTWARE MANSION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creativeforge Games and SOFTWARE MANSION
The main advantage of trading using opposite Creativeforge Games and SOFTWARE MANSION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creativeforge Games position performs unexpectedly, SOFTWARE MANSION 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 SOFTWARE MANSION will offset losses from the drop in SOFTWARE MANSION's long position.| Creativeforge Games vs. ECC Games SA | Creativeforge Games vs. Asseco Business Solutions | Creativeforge Games vs. Kogeneracja SA | Creativeforge Games vs. Asseco South Eastern |
| SOFTWARE MANSION vs. Mercator Medical SA | SOFTWARE MANSION vs. Quantum Software SA | SOFTWARE MANSION vs. Intersport Polska SA | SOFTWARE MANSION vs. LSI Software 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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