Correlation Between GAMESTOP and CNVISION MEDIA
Can any of the company-specific risk be diversified away by investing in both GAMESTOP and CNVISION MEDIA 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 and CNVISION MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMESTOP and CNVISION MEDIA, you can compare the effects of market volatilities on GAMESTOP and CNVISION MEDIA 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 with a short position of CNVISION MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMESTOP and CNVISION MEDIA.
Diversification Opportunities for GAMESTOP and CNVISION MEDIA
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between GAMESTOP and CNVISION is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding GAMESTOP and CNVISION MEDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNVISION MEDIA and GAMESTOP 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 are associated (or correlated) with CNVISION MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNVISION MEDIA has no effect on the direction of GAMESTOP i.e., GAMESTOP and CNVISION MEDIA go up and down completely randomly.
Pair Corralation between GAMESTOP and CNVISION MEDIA
Assuming the 90 days trading horizon GAMESTOP is expected to under-perform the CNVISION MEDIA. In addition to that, GAMESTOP is 1.32 times more volatile than CNVISION MEDIA. It trades about -0.21 of its total potential returns per unit of risk. CNVISION MEDIA is currently generating about 0.18 per unit of volatility. If you would invest 5.60 in CNVISION MEDIA on October 31, 2024 and sell it today you would earn a total of 0.50 from holding CNVISION MEDIA or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMESTOP vs. CNVISION MEDIA
Performance |
| Timeline |
| GAMESTOP |
| CNVISION MEDIA |
GAMESTOP and CNVISION MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMESTOP and CNVISION MEDIA
The main advantage of trading using opposite GAMESTOP and CNVISION MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMESTOP position performs unexpectedly, CNVISION MEDIA 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 CNVISION MEDIA will offset losses from the drop in CNVISION MEDIA's long position.The idea behind GAMESTOP and CNVISION MEDIA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CNVISION MEDIA vs. Materialise NV | CNVISION MEDIA vs. Firan Technology Group | CNVISION MEDIA vs. Compagnie Plastic Omnium | CNVISION MEDIA vs. Goodyear Tire Rubber |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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