Correlation Between Gaming Corps and Doxa AB
Can any of the company-specific risk be diversified away by investing in both Gaming Corps and Doxa AB 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 Gaming Corps and Doxa AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaming Corps AB and Doxa AB, you can compare the effects of market volatilities on Gaming Corps and Doxa AB 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 Gaming Corps with a short position of Doxa AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaming Corps and Doxa AB.
Diversification Opportunities for Gaming Corps and Doxa AB
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gaming and Doxa is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Gaming Corps AB and Doxa AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doxa AB and Gaming Corps 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 Gaming Corps AB are associated (or correlated) with Doxa AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doxa AB has no effect on the direction of Gaming Corps i.e., Gaming Corps and Doxa AB go up and down completely randomly.
Pair Corralation between Gaming Corps and Doxa AB
Assuming the 90 days trading horizon Gaming Corps AB is expected to generate 1.34 times more return on investment than Doxa AB. However, Gaming Corps is 1.34 times more volatile than Doxa AB. It trades about -0.03 of its potential returns per unit of risk. Doxa AB is currently generating about -0.09 per unit of risk. If you would invest 245.00 in Gaming Corps AB on September 3, 2024 and sell it today you would lose (178.00) from holding Gaming Corps AB or give up 72.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaming Corps AB vs. Doxa AB
Performance |
| Timeline |
| Gaming Corps AB |
| Doxa AB |
Gaming Corps and Doxa AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaming Corps and Doxa AB
The main advantage of trading using opposite Gaming Corps and Doxa AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaming Corps position performs unexpectedly, Doxa AB 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 Doxa AB will offset losses from the drop in Doxa AB's long position.| Gaming Corps vs. Idogen AB | Gaming Corps vs. Clean Motion AB | Gaming Corps vs. Arion banki hf | Gaming Corps vs. KABE Group AB |
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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