Correlation Between GungHo Online and Strategic Investments
Can any of the company-specific risk be diversified away by investing in both GungHo Online and Strategic Investments 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 GungHo Online and Strategic Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GungHo Online Entertainment and Strategic Investments AS, you can compare the effects of market volatilities on GungHo Online and Strategic Investments 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 GungHo Online with a short position of Strategic Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and Strategic Investments.
Diversification Opportunities for GungHo Online and Strategic Investments
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GungHo and Strategic is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and Strategic Investments AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Investments and GungHo Online 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 GungHo Online Entertainment are associated (or correlated) with Strategic Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Investments has no effect on the direction of GungHo Online i.e., GungHo Online and Strategic Investments go up and down completely randomly.
Pair Corralation between GungHo Online and Strategic Investments
Assuming the 90 days horizon GungHo Online Entertainment is expected to under-perform the Strategic Investments. But the stock apears to be less risky and, when comparing its historical volatility, GungHo Online Entertainment is 1.48 times less risky than Strategic Investments. The stock trades about -0.2 of its potential returns per unit of risk. The Strategic Investments AS is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Strategic Investments AS on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Strategic Investments AS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. Strategic Investments AS
Performance |
| Timeline |
| GungHo Online Entert |
| Strategic Investments |
GungHo Online and Strategic Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and Strategic Investments
The main advantage of trading using opposite GungHo Online and Strategic Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, Strategic Investments 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 Strategic Investments will offset losses from the drop in Strategic Investments' long position.| GungHo Online vs. CPU SOFTWAREHOUSE | GungHo Online vs. Singapore Telecommunications Limited | GungHo Online vs. Iridium Communications | GungHo Online vs. Alfa Financial Software |
| Strategic Investments vs. Ameriprise Financial | Strategic Investments vs. Ares Management Corp | Strategic Investments vs. Superior Plus Corp | Strategic Investments vs. NMI Holdings |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |