Correlation Between GungHo Online and CARSALES
Can any of the company-specific risk be diversified away by investing in both GungHo Online and CARSALES 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 CARSALES 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 CARSALESCOM, you can compare the effects of market volatilities on GungHo Online and CARSALES 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 CARSALES. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and CARSALES.
Diversification Opportunities for GungHo Online and CARSALES
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GungHo and CARSALES is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and CARSALESCOM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARSALESCOM 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 CARSALES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARSALESCOM has no effect on the direction of GungHo Online i.e., GungHo Online and CARSALES go up and down completely randomly.
Pair Corralation between GungHo Online and CARSALES
Assuming the 90 days horizon GungHo Online Entertainment is expected to under-perform the CARSALES. In addition to that, GungHo Online is 1.61 times more volatile than CARSALESCOM. It trades about -0.16 of its total potential returns per unit of risk. CARSALESCOM is currently generating about 0.38 per unit of volatility. If you would invest 2,280 in CARSALESCOM on September 1, 2024 and sell it today you would earn a total of 280.00 from holding CARSALESCOM or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. CARSALESCOM
Performance |
| Timeline |
| GungHo Online Entert |
| CARSALESCOM |
GungHo Online and CARSALES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and CARSALES
The main advantage of trading using opposite GungHo Online and CARSALES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, CARSALES 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 CARSALES will offset losses from the drop in CARSALES's long position.| GungHo Online vs. ULTRA CLEAN HLDGS | GungHo Online vs. Broadcom | GungHo Online vs. UNITED RENTALS | GungHo Online vs. Nishi Nippon Railroad Co |
| CARSALES vs. CNVISION MEDIA | CARSALES vs. OURGAME INTHOLDL 00005 | CARSALES vs. Playa Hotels Resorts | CARSALES vs. Universal Entertainment |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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