Correlation Between Games Workshop and Lendinvest PLC
Can any of the company-specific risk be diversified away by investing in both Games Workshop and Lendinvest PLC 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 Lendinvest PLC 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 Lendinvest PLC, you can compare the effects of market volatilities on Games Workshop and Lendinvest PLC 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 Lendinvest PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Games Workshop and Lendinvest PLC.
Diversification Opportunities for Games Workshop and Lendinvest PLC
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Games and Lendinvest is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Games Workshop Group and Lendinvest PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendinvest PLC 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 Lendinvest PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendinvest PLC has no effect on the direction of Games Workshop i.e., Games Workshop and Lendinvest PLC go up and down completely randomly.
Pair Corralation between Games Workshop and Lendinvest PLC
Assuming the 90 days trading horizon Games Workshop Group is expected to generate 3.42 times more return on investment than Lendinvest PLC. However, Games Workshop is 3.42 times more volatile than Lendinvest PLC. It trades about 0.14 of its potential returns per unit of risk. Lendinvest PLC is currently generating about 0.08 per unit of risk. If you would invest 1,201,000 in Games Workshop Group on August 29, 2024 and sell it today you would earn a total of 142,000 from holding Games Workshop Group or generate 11.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Games Workshop Group vs. Lendinvest PLC
Performance |
| Timeline |
| Games Workshop Group |
| Lendinvest PLC |
Games Workshop and Lendinvest PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Games Workshop and Lendinvest PLC
The main advantage of trading using opposite Games Workshop and Lendinvest PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Games Workshop position performs unexpectedly, Lendinvest PLC 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 Lendinvest PLC will offset losses from the drop in Lendinvest PLC's long position.| Games Workshop vs. Ondine Biomedical | Games Workshop vs. Europa Metals | Games Workshop vs. Lendinvest PLC | Games Workshop vs. Neometals |
| Lendinvest PLC vs. Toyota Motor Corp | Lendinvest PLC vs. Neometals | Lendinvest PLC vs. Coor Service Management | Lendinvest PLC vs. Albion Technology General |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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