Correlation Between Games Workshop and SQUIRREL MEDIA
Can any of the company-specific risk be diversified away by investing in both Games Workshop and SQUIRREL MEDIA 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 Games Workshop and SQUIRREL MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Games Workshop Group and SQUIRREL MEDIA SA, you can compare the effects of market volatilities on Games Workshop and SQUIRREL MEDIA 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 Games Workshop with a short position of SQUIRREL MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Games Workshop and SQUIRREL MEDIA.
Diversification Opportunities for Games Workshop and SQUIRREL MEDIA
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Games and SQUIRREL is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Games Workshop Group and SQUIRREL MEDIA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SQUIRREL MEDIA SA and Games Workshop 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 Games Workshop Group are associated (or correlated) with SQUIRREL MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SQUIRREL MEDIA SA has no effect on the direction of Games Workshop i.e., Games Workshop and SQUIRREL MEDIA go up and down completely randomly.
Pair Corralation between Games Workshop and SQUIRREL MEDIA
Assuming the 90 days trading horizon Games Workshop Group is expected to generate 1.25 times more return on investment than SQUIRREL MEDIA. However, Games Workshop is 1.25 times more volatile than SQUIRREL MEDIA SA. It trades about 0.12 of its potential returns per unit of risk. SQUIRREL MEDIA SA is currently generating about -0.03 per unit of risk. If you would invest 12,078 in Games Workshop Group on November 8, 2024 and sell it today you would earn a total of 5,362 from holding Games Workshop Group or generate 44.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Games Workshop Group vs. SQUIRREL MEDIA SA
Performance |
| Timeline |
| Games Workshop Group |
| SQUIRREL MEDIA SA |
Games Workshop and SQUIRREL MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Games Workshop and SQUIRREL MEDIA
The main advantage of trading using opposite Games Workshop and SQUIRREL MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Games Workshop position performs unexpectedly, SQUIRREL MEDIA 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 SQUIRREL MEDIA will offset losses from the drop in SQUIRREL MEDIA's long position.| Games Workshop vs. DISTRICT METALS | Games Workshop vs. Monster Beverage Corp | Games Workshop vs. FIREWEED METALS P | Games Workshop vs. Zijin Mining Group |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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