Correlation Between Etsy and Bragg Gaming
Can any of the company-specific risk be diversified away by investing in both Etsy and Bragg 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 Etsy and Bragg Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Etsy Inc and Bragg Gaming Group, you can compare the effects of market volatilities on Etsy and Bragg 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 Etsy with a short position of Bragg Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Etsy and Bragg Gaming.
Diversification Opportunities for Etsy and Bragg Gaming
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Etsy and Bragg is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Etsy Inc and Bragg Gaming Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bragg Gaming Group and Etsy 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 Etsy Inc are associated (or correlated) with Bragg Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bragg Gaming Group has no effect on the direction of Etsy i.e., Etsy and Bragg Gaming go up and down completely randomly.
Pair Corralation between Etsy and Bragg Gaming
Given the investment horizon of 90 days Etsy Inc is expected to generate 0.44 times more return on investment than Bragg Gaming. However, Etsy Inc is 2.27 times less risky than Bragg Gaming. It trades about 0.14 of its potential returns per unit of risk. Bragg Gaming Group is currently generating about -0.07 per unit of risk. If you would invest 5,177 in Etsy Inc on September 19, 2024 and sell it today you would earn a total of 714.50 from holding Etsy Inc or generate 13.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Etsy Inc vs. Bragg Gaming Group
Performance |
| Timeline |
| Etsy Inc |
| Bragg Gaming Group |
Etsy and Bragg Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Etsy and Bragg Gaming
The main advantage of trading using opposite Etsy and Bragg Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Etsy position performs unexpectedly, Bragg 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 Bragg Gaming will offset losses from the drop in Bragg Gaming's long position.The idea behind Etsy Inc and Bragg Gaming Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Bragg Gaming vs. Global E Online | Bragg Gaming vs. Etsy Inc | Bragg Gaming vs. PDD Holdings | Bragg Gaming vs. JD Inc Adr |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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