Correlation Between Electronic Arts and Gyre Therapeutics
Can any of the company-specific risk be diversified away by investing in both Electronic Arts and Gyre Therapeutics 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 Gyre Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronic Arts and Gyre Therapeutics, you can compare the effects of market volatilities on Electronic Arts and Gyre Therapeutics 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 Gyre Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronic Arts and Gyre Therapeutics.
Diversification Opportunities for Electronic Arts and Gyre Therapeutics
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Electronic and Gyre is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Electronic Arts and Gyre Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gyre Therapeutics 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 Gyre Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gyre Therapeutics has no effect on the direction of Electronic Arts i.e., Electronic Arts and Gyre Therapeutics go up and down completely randomly.
Pair Corralation between Electronic Arts and Gyre Therapeutics
Allowing for the 90-day total investment horizon Electronic Arts is expected to generate 0.28 times more return on investment than Gyre Therapeutics. However, Electronic Arts is 3.51 times less risky than Gyre Therapeutics. It trades about 0.1 of its potential returns per unit of risk. Gyre Therapeutics is currently generating about -0.04 per unit of risk. If you would invest 15,165 in Electronic Arts on August 30, 2024 and sell it today you would earn a total of 1,145 from holding Electronic Arts or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electronic Arts vs. Gyre Therapeutics
Performance |
| Timeline |
| Electronic Arts |
| Gyre Therapeutics |
Electronic Arts and Gyre Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronic Arts and Gyre Therapeutics
The main advantage of trading using opposite Electronic Arts and Gyre Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronic Arts position performs unexpectedly, Gyre Therapeutics 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 Gyre Therapeutics will offset losses from the drop in Gyre Therapeutics' long position.| Electronic Arts vs. Nintendo Co ADR | Electronic Arts vs. Roblox Corp | Electronic Arts vs. NetEase | Electronic Arts vs. Take Two Interactive Software |
| Gyre Therapeutics vs. Playtika Holding Corp | Gyre Therapeutics vs. Tootsie Roll Industries | Gyre Therapeutics vs. Senmiao Technology | Gyre Therapeutics vs. NETGEAR |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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