Correlation Between Games Workshop and Las Vegas
Can any of the company-specific risk be diversified away by investing in both Games Workshop and Las Vegas 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 Las Vegas 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 Las Vegas Sands, you can compare the effects of market volatilities on Games Workshop and Las Vegas 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 Las Vegas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Games Workshop and Las Vegas.
Diversification Opportunities for Games Workshop and Las Vegas
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Games and Las is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Games Workshop Group and Las Vegas Sands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Las Vegas Sands 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 Las Vegas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Las Vegas Sands has no effect on the direction of Games Workshop i.e., Games Workshop and Las Vegas go up and down completely randomly.
Pair Corralation between Games Workshop and Las Vegas
Assuming the 90 days trading horizon Games Workshop Group is expected to generate 2.0 times more return on investment than Las Vegas. However, Games Workshop is 2.0 times more volatile than Las Vegas Sands. It trades about 0.09 of its potential returns per unit of risk. Las Vegas Sands is currently generating about -0.04 per unit of risk. If you would invest 1,204,000 in Games Workshop Group on October 11, 2024 and sell it today you would earn a total of 114,000 from holding Games Workshop Group or generate 9.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Games Workshop Group vs. Las Vegas Sands
Performance |
| Timeline |
| Games Workshop Group |
| Las Vegas Sands |
Games Workshop and Las Vegas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Games Workshop and Las Vegas
The main advantage of trading using opposite Games Workshop and Las Vegas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Games Workshop position performs unexpectedly, Las Vegas 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 Las Vegas will offset losses from the drop in Las Vegas' long position.| Games Workshop vs. GreenX Metals | Games Workshop vs. Wheaton Precious Metals | Games Workshop vs. Batm Advanced Communications | Games Workshop vs. Aeorema Communications Plc |
| Las Vegas vs. Associated British Foods | Las Vegas vs. Gear4music Plc | Las Vegas vs. Games Workshop Group | Las Vegas vs. Gaming Realms plc |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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