Correlation Between Enad Global and Fractal Gaming
Can any of the company-specific risk be diversified away by investing in both Enad Global and Fractal Gaming 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 Enad Global and Fractal Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enad Global 7 and Fractal Gaming Group, you can compare the effects of market volatilities on Enad Global and Fractal Gaming 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 Enad Global with a short position of Fractal Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enad Global and Fractal Gaming.
Diversification Opportunities for Enad Global and Fractal Gaming
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Enad and Fractal is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Enad Global 7 and Fractal Gaming Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fractal Gaming Group and Enad Global 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 Enad Global 7 are associated (or correlated) with Fractal Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fractal Gaming Group has no effect on the direction of Enad Global i.e., Enad Global and Fractal Gaming go up and down completely randomly.
Pair Corralation between Enad Global and Fractal Gaming
Assuming the 90 days trading horizon Enad Global 7 is expected to generate 2.04 times more return on investment than Fractal Gaming. However, Enad Global is 2.04 times more volatile than Fractal Gaming Group. It trades about 0.04 of its potential returns per unit of risk. Fractal Gaming Group is currently generating about -0.17 per unit of risk. If you would invest 1,365 in Enad Global 7 on August 29, 2024 and sell it today you would earn a total of 25.00 from holding Enad Global 7 or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enad Global 7 vs. Fractal Gaming Group
Performance |
| Timeline |
| Enad Global 7 |
| Fractal Gaming Group |
Enad Global and Fractal Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enad Global and Fractal Gaming
The main advantage of trading using opposite Enad Global and Fractal Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enad Global position performs unexpectedly, Fractal Gaming 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 Fractal Gaming will offset losses from the drop in Fractal Gaming's long position.| Enad Global vs. Stillfront Group AB | Enad Global vs. Embracer Group AB | Enad Global vs. G5 Entertainment publ | Enad Global vs. Sinch AB |
| Fractal Gaming vs. Media and Games | Fractal Gaming vs. Cint Group AB | Fractal Gaming vs. Thunderful Group AB | Fractal Gaming vs. Enad Global 7 |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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