Correlation Between Gaming Realms and Sparebank
Can any of the company-specific risk be diversified away by investing in both Gaming Realms and Sparebank 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 Realms and Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaming Realms plc and Sparebank 1 SR, you can compare the effects of market volatilities on Gaming Realms and Sparebank 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 Realms with a short position of Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaming Realms and Sparebank.
Diversification Opportunities for Gaming Realms and Sparebank
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gaming and Sparebank is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Gaming Realms plc and Sparebank 1 SR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparebank 1 SR and Gaming Realms 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 Realms plc are associated (or correlated) with Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparebank 1 SR has no effect on the direction of Gaming Realms i.e., Gaming Realms and Sparebank go up and down completely randomly.
Pair Corralation between Gaming Realms and Sparebank
Assuming the 90 days trading horizon Gaming Realms plc is expected to under-perform the Sparebank. In addition to that, Gaming Realms is 2.77 times more volatile than Sparebank 1 SR. It trades about -0.04 of its total potential returns per unit of risk. Sparebank 1 SR is currently generating about 0.13 per unit of volatility. If you would invest 13,200 in Sparebank 1 SR on September 3, 2024 and sell it today you would earn a total of 1,280 from holding Sparebank 1 SR or generate 9.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaming Realms plc vs. Sparebank 1 SR
Performance |
| Timeline |
| Gaming Realms plc |
| Sparebank 1 SR |
Gaming Realms and Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaming Realms and Sparebank
The main advantage of trading using opposite Gaming Realms and Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaming Realms position performs unexpectedly, Sparebank 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 Sparebank will offset losses from the drop in Sparebank's long position.| Gaming Realms vs. X FAB Silicon Foundries | Gaming Realms vs. K3 Business Technology | Gaming Realms vs. Scandinavian Tobacco Group | Gaming Realms vs. Albion Technology General |
| Sparebank vs. Porvair plc | Sparebank vs. Gaming Realms plc | Sparebank vs. Cairn Homes PLC | Sparebank vs. Bloomsbury Publishing Plc |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |