Correlation Between GameStop Corp and Sartorius Stedim
Can any of the company-specific risk be diversified away by investing in both GameStop Corp and Sartorius Stedim 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 Sartorius Stedim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GameStop Corp and Sartorius Stedim Biotech, you can compare the effects of market volatilities on GameStop Corp and Sartorius Stedim 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 Sartorius Stedim. Check out your portfolio center. Please also check ongoing floating volatility patterns of GameStop Corp and Sartorius Stedim.
Diversification Opportunities for GameStop Corp and Sartorius Stedim
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GameStop and Sartorius is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding GameStop Corp and Sartorius Stedim Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sartorius Stedim Biotech 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 Sartorius Stedim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sartorius Stedim Biotech has no effect on the direction of GameStop Corp i.e., GameStop Corp and Sartorius Stedim go up and down completely randomly.
Pair Corralation between GameStop Corp and Sartorius Stedim
Assuming the 90 days trading horizon GameStop Corp is expected to generate 2.3 times more return on investment than Sartorius Stedim. However, GameStop Corp is 2.3 times more volatile than Sartorius Stedim Biotech. It trades about 0.04 of its potential returns per unit of risk. Sartorius Stedim Biotech is currently generating about 0.01 per unit of risk. If you would invest 2,588 in GameStop Corp on September 1, 2024 and sell it today you would earn a total of 95.00 from holding GameStop Corp or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.24% |
| Values | Daily Returns |
GameStop Corp vs. Sartorius Stedim Biotech
Performance |
| Timeline |
| GameStop Corp |
| Sartorius Stedim Biotech |
GameStop Corp and Sartorius Stedim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GameStop Corp and Sartorius Stedim
The main advantage of trading using opposite GameStop Corp and Sartorius Stedim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GameStop Corp position performs unexpectedly, Sartorius Stedim 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 Sartorius Stedim will offset losses from the drop in Sartorius Stedim's long position.| GameStop Corp vs. MercadoLibre | GameStop Corp vs. AutoZone | GameStop Corp vs. Superior Plus Corp | GameStop Corp vs. NMI Holdings |
| Sartorius Stedim vs. ESSILORLUXOTTICA 12ON | Sartorius Stedim vs. Intuitive Surgical | Sartorius Stedim vs. EssilorLuxottica Socit anonyme | Sartorius Stedim vs. HOYA Corporation |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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