Correlation Between Galaxy Gaming and Whitbread Plc
Can any of the company-specific risk be diversified away by investing in both Galaxy Gaming and Whitbread 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 Galaxy Gaming and Whitbread Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galaxy Gaming and Whitbread plc, you can compare the effects of market volatilities on Galaxy Gaming and Whitbread 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 Galaxy Gaming with a short position of Whitbread Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galaxy Gaming and Whitbread Plc.
Diversification Opportunities for Galaxy Gaming and Whitbread Plc
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Galaxy and Whitbread is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Galaxy Gaming and Whitbread plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whitbread plc and Galaxy Gaming 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 Galaxy Gaming are associated (or correlated) with Whitbread Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whitbread plc has no effect on the direction of Galaxy Gaming i.e., Galaxy Gaming and Whitbread Plc go up and down completely randomly.
Pair Corralation between Galaxy Gaming and Whitbread Plc
Given the investment horizon of 90 days Galaxy Gaming is expected to generate 1.31 times more return on investment than Whitbread Plc. However, Galaxy Gaming is 1.31 times more volatile than Whitbread plc. It trades about -0.03 of its potential returns per unit of risk. Whitbread plc is currently generating about -0.22 per unit of risk. If you would invest 278.00 in Galaxy Gaming on October 11, 2024 and sell it today you would lose (2.00) from holding Galaxy Gaming or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Galaxy Gaming vs. Whitbread plc
Performance |
| Timeline |
| Galaxy Gaming |
| Whitbread plc |
Galaxy Gaming and Whitbread Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galaxy Gaming and Whitbread Plc
The main advantage of trading using opposite Galaxy Gaming and Whitbread Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galaxy Gaming position performs unexpectedly, Whitbread 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 Whitbread Plc will offset losses from the drop in Whitbread Plc's long position.| Galaxy Gaming vs. Intema Solutions | Galaxy Gaming vs. 888 Holdings | Galaxy Gaming vs. Royal Wins | Galaxy Gaming vs. Real Luck Group |
| Whitbread Plc vs. Keurig Dr Pepper | Whitbread Plc vs. China Tontine Wines | Whitbread Plc vs. Naked Wines plc | Whitbread Plc vs. Galaxy Gaming |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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