Correlation Between GAMESTOP and Aurubis AG
Can any of the company-specific risk be diversified away by investing in both GAMESTOP and Aurubis AG 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 Aurubis AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMESTOP and Aurubis AG, you can compare the effects of market volatilities on GAMESTOP and Aurubis AG 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 Aurubis AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMESTOP and Aurubis AG.
Diversification Opportunities for GAMESTOP and Aurubis AG
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GAMESTOP and Aurubis is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding GAMESTOP and Aurubis AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurubis AG 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 Aurubis AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurubis AG has no effect on the direction of GAMESTOP i.e., GAMESTOP and Aurubis AG go up and down completely randomly.
Pair Corralation between GAMESTOP and Aurubis AG
Assuming the 90 days trading horizon GAMESTOP is expected to generate 3.22 times more return on investment than Aurubis AG. However, GAMESTOP is 3.22 times more volatile than Aurubis AG. It trades about 0.03 of its potential returns per unit of risk. Aurubis AG is currently generating about -0.45 per unit of risk. If you would invest 2,712 in GAMESTOP on October 17, 2024 and sell it today you would earn a total of 25.00 from holding GAMESTOP or generate 0.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMESTOP vs. Aurubis AG
Performance |
| Timeline |
| GAMESTOP |
| Aurubis AG |
GAMESTOP and Aurubis AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMESTOP and Aurubis AG
The main advantage of trading using opposite GAMESTOP and Aurubis AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMESTOP position performs unexpectedly, Aurubis AG 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 Aurubis AG will offset losses from the drop in Aurubis AG's long position.| GAMESTOP vs. OPKO HEALTH | GAMESTOP vs. Cardinal Health | GAMESTOP vs. VIRGIN WINES UK | GAMESTOP vs. US Physical Therapy |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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