Correlation Between AMCON Distributing and GameStop Corp
Can any of the company-specific risk be diversified away by investing in both AMCON Distributing and GameStop Corp 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 AMCON Distributing and GameStop Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMCON Distributing and GameStop Corp, you can compare the effects of market volatilities on AMCON Distributing and GameStop Corp 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 AMCON Distributing with a short position of GameStop Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMCON Distributing and GameStop Corp.
Diversification Opportunities for AMCON Distributing and GameStop Corp
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AMCON and GameStop is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding AMCON Distributing and GameStop Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GameStop Corp and AMCON Distributing 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 AMCON Distributing are associated (or correlated) with GameStop Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GameStop Corp has no effect on the direction of AMCON Distributing i.e., AMCON Distributing and GameStop Corp go up and down completely randomly.
Pair Corralation between AMCON Distributing and GameStop Corp
Considering the 90-day investment horizon AMCON Distributing is expected to under-perform the GameStop Corp. But the stock apears to be less risky and, when comparing its historical volatility, AMCON Distributing is 3.13 times less risky than GameStop Corp. The stock trades about -0.06 of its potential returns per unit of risk. The GameStop Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,427 in GameStop Corp on August 27, 2024 and sell it today you would earn a total of 1,363 from holding GameStop Corp or generate 95.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.34% |
| Values | Daily Returns |
AMCON Distributing vs. GameStop Corp
Performance |
| Timeline |
| AMCON Distributing |
| GameStop Corp |
AMCON Distributing and GameStop Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMCON Distributing and GameStop Corp
The main advantage of trading using opposite AMCON Distributing and GameStop Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMCON Distributing position performs unexpectedly, GameStop Corp 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 GameStop Corp will offset losses from the drop in GameStop Corp's long position.| AMCON Distributing vs. The Chefs Warehouse | AMCON Distributing vs. G Willi Food International | AMCON Distributing vs. SpartanNash Co | AMCON Distributing vs. Calavo Growers |
| GameStop Corp vs. RH | GameStop Corp vs. Dicks Sporting Goods | GameStop Corp vs. Best Buy Co | GameStop Corp vs. AutoZone |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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