Correlation Between GD Culture and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both GD Culture and Electronic Arts 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 GD Culture and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GD Culture Group and Electronic Arts, you can compare the effects of market volatilities on GD Culture and Electronic Arts 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 GD Culture with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of GD Culture and Electronic Arts.
Diversification Opportunities for GD Culture and Electronic Arts
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GDC and Electronic is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding GD Culture Group and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and GD Culture 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 GD Culture Group are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of GD Culture i.e., GD Culture and Electronic Arts go up and down completely randomly.
Pair Corralation between GD Culture and Electronic Arts
Considering the 90-day investment horizon GD Culture Group is expected to generate 11.37 times more return on investment than Electronic Arts. However, GD Culture is 11.37 times more volatile than Electronic Arts. It trades about 0.04 of its potential returns per unit of risk. Electronic Arts is currently generating about 0.05 per unit of risk. If you would invest 294.00 in GD Culture Group on September 14, 2024 and sell it today you would lose (86.00) from holding GD Culture Group or give up 29.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GD Culture Group vs. Electronic Arts
Performance |
| Timeline |
| GD Culture Group |
| Electronic Arts |
GD Culture and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GD Culture and Electronic Arts
The main advantage of trading using opposite GD Culture and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GD Culture position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| GD Culture vs. SohuCom | GD Culture vs. Playstudios | GD Culture vs. NetEase | GD Culture vs. Golden Matrix Group |
| Electronic Arts vs. Doubledown Interactive Co | Electronic Arts vs. GD Culture Group | Electronic Arts vs. GameSquare Holdings | Electronic Arts vs. GDEV Inc |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |