Correlation Between GameStop Corp and Western Acquisition
Can any of the company-specific risk be diversified away by investing in both GameStop Corp and Western Acquisition 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 GameStop Corp and Western Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GameStop Corp and Western Acquisition Ventures, you can compare the effects of market volatilities on GameStop Corp and Western Acquisition 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 GameStop Corp with a short position of Western Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of GameStop Corp and Western Acquisition.
Diversification Opportunities for GameStop Corp and Western Acquisition
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between GameStop and Western is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding GameStop Corp and Western Acquisition Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Acquisition and GameStop Corp 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 GameStop Corp are associated (or correlated) with Western Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Acquisition has no effect on the direction of GameStop Corp i.e., GameStop Corp and Western Acquisition go up and down completely randomly.
Pair Corralation between GameStop Corp and Western Acquisition
Considering the 90-day investment horizon GameStop Corp is expected to generate 6.71 times more return on investment than Western Acquisition. However, GameStop Corp is 6.71 times more volatile than Western Acquisition Ventures. It trades about 0.07 of its potential returns per unit of risk. Western Acquisition Ventures is currently generating about 0.0 per unit of risk. If you would invest 1,353 in GameStop Corp on September 1, 2024 and sell it today you would earn a total of 1,552 from holding GameStop Corp or generate 114.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GameStop Corp vs. Western Acquisition Ventures
Performance |
| Timeline |
| GameStop Corp |
| Western Acquisition |
GameStop Corp and Western Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GameStop Corp and Western Acquisition
The main advantage of trading using opposite GameStop Corp and Western Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GameStop Corp position performs unexpectedly, Western Acquisition 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 Western Acquisition will offset losses from the drop in Western Acquisition's long position.| GameStop Corp vs. RH | GameStop Corp vs. Dicks Sporting Goods | GameStop Corp vs. Best Buy Co | GameStop Corp vs. AutoZone |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |