Correlation Between Floor Decor and Gamehost
Can any of the company-specific risk be diversified away by investing in both Floor Decor and Gamehost 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 Floor Decor and Gamehost into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Floor Decor Holdings and Gamehost, you can compare the effects of market volatilities on Floor Decor and Gamehost 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 Floor Decor with a short position of Gamehost. Check out your portfolio center. Please also check ongoing floating volatility patterns of Floor Decor and Gamehost.
Diversification Opportunities for Floor Decor and Gamehost
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Floor and Gamehost is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Floor Decor Holdings and Gamehost in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamehost and Floor Decor 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 Floor Decor Holdings are associated (or correlated) with Gamehost. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamehost has no effect on the direction of Floor Decor i.e., Floor Decor and Gamehost go up and down completely randomly.
Pair Corralation between Floor Decor and Gamehost
Considering the 90-day investment horizon Floor Decor Holdings is expected to generate 0.84 times more return on investment than Gamehost. However, Floor Decor Holdings is 1.19 times less risky than Gamehost. It trades about 0.03 of its potential returns per unit of risk. Gamehost is currently generating about 0.02 per unit of risk. If you would invest 9,602 in Floor Decor Holdings on September 12, 2024 and sell it today you would earn a total of 1,582 from holding Floor Decor Holdings or generate 16.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 56.57% |
| Values | Daily Returns |
Floor Decor Holdings vs. Gamehost
Performance |
| Timeline |
| Floor Decor Holdings |
| Gamehost |
Floor Decor and Gamehost Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Floor Decor and Gamehost
The main advantage of trading using opposite Floor Decor and Gamehost positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Floor Decor position performs unexpectedly, Gamehost 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 Gamehost will offset losses from the drop in Gamehost's long position.| Floor Decor vs. Victory Integrity Smallmid Cap | Floor Decor vs. Hilton Worldwide Holdings | Floor Decor vs. NVIDIA | Floor Decor vs. JPMorgan Chase Co |
| Gamehost vs. Titan Machinery | Gamehost vs. Asbury Automotive Group | Gamehost vs. Addus HomeCare | Gamehost vs. SunLink Health Systems |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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