Correlation Between Electronic Arts and Bilibili
Can any of the company-specific risk be diversified away by investing in both Electronic Arts and Bilibili 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 Electronic Arts and Bilibili into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronic Arts and Bilibili, you can compare the effects of market volatilities on Electronic Arts and Bilibili 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 Electronic Arts with a short position of Bilibili. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronic Arts and Bilibili.
Diversification Opportunities for Electronic Arts and Bilibili
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Electronic and Bilibili is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Electronic Arts and Bilibili in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilibili and Electronic Arts 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 Electronic Arts are associated (or correlated) with Bilibili. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilibili has no effect on the direction of Electronic Arts i.e., Electronic Arts and Bilibili go up and down completely randomly.
Pair Corralation between Electronic Arts and Bilibili
Allowing for the 90-day total investment horizon Electronic Arts is expected to under-perform the Bilibili. But the stock apears to be less risky and, when comparing its historical volatility, Electronic Arts is 2.67 times less risky than Bilibili. The stock trades about -0.09 of its potential returns per unit of risk. The Bilibili is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,461 in Bilibili on November 2, 2024 and sell it today you would earn a total of 298.00 from holding Bilibili or generate 20.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electronic Arts vs. Bilibili
Performance |
| Timeline |
| Electronic Arts |
| Bilibili |
Electronic Arts and Bilibili Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronic Arts and Bilibili
The main advantage of trading using opposite Electronic Arts and Bilibili positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronic Arts position performs unexpectedly, Bilibili 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 Bilibili will offset losses from the drop in Bilibili's long position.| Electronic Arts vs. Nintendo Co ADR | Electronic Arts vs. Roblox Corp | Electronic Arts vs. NetEase | Electronic Arts vs. Take Two Interactive Software |
| Bilibili vs. Electronic Arts | Bilibili vs. Take Two Interactive Software | Bilibili vs. SohuCom | Bilibili vs. Skillz Platform |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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