Correlation Between Fractal Gaming and New Nordic
Can any of the company-specific risk be diversified away by investing in both Fractal Gaming and New Nordic 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 Fractal Gaming and New Nordic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fractal Gaming Group and New Nordic Healthbrands, you can compare the effects of market volatilities on Fractal Gaming and New Nordic 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 Fractal Gaming with a short position of New Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fractal Gaming and New Nordic.
Diversification Opportunities for Fractal Gaming and New Nordic
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fractal and New is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Fractal Gaming Group and New Nordic Healthbrands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Nordic Healthbrands and Fractal Gaming 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 Fractal Gaming Group are associated (or correlated) with New Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Nordic Healthbrands has no effect on the direction of Fractal Gaming i.e., Fractal Gaming and New Nordic go up and down completely randomly.
Pair Corralation between Fractal Gaming and New Nordic
Assuming the 90 days trading horizon Fractal Gaming Group is expected to generate 0.9 times more return on investment than New Nordic. However, Fractal Gaming Group is 1.11 times less risky than New Nordic. It trades about 0.02 of its potential returns per unit of risk. New Nordic Healthbrands is currently generating about -0.03 per unit of risk. If you would invest 3,080 in Fractal Gaming Group on August 29, 2024 and sell it today you would earn a total of 100.00 from holding Fractal Gaming Group or generate 3.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fractal Gaming Group vs. New Nordic Healthbrands
Performance |
| Timeline |
| Fractal Gaming Group |
| New Nordic Healthbrands |
Fractal Gaming and New Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fractal Gaming and New Nordic
The main advantage of trading using opposite Fractal Gaming and New Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fractal Gaming position performs unexpectedly, New Nordic 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 New Nordic will offset losses from the drop in New Nordic's long position.| 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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