Correlation Between GAMESTOP and Universal Display
Can any of the company-specific risk be diversified away by investing in both GAMESTOP and Universal Display 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 Universal Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMESTOP and Universal Display, you can compare the effects of market volatilities on GAMESTOP and Universal Display 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 Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMESTOP and Universal Display.
Diversification Opportunities for GAMESTOP and Universal Display
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GAMESTOP and Universal is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding GAMESTOP and Universal Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display 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 Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display has no effect on the direction of GAMESTOP i.e., GAMESTOP and Universal Display go up and down completely randomly.
Pair Corralation between GAMESTOP and Universal Display
Assuming the 90 days trading horizon GAMESTOP is expected to generate 1.08 times more return on investment than Universal Display. However, GAMESTOP is 1.08 times more volatile than Universal Display. It trades about 0.41 of its potential returns per unit of risk. Universal Display is currently generating about -0.19 per unit of risk. If you would invest 2,080 in GAMESTOP on August 29, 2024 and sell it today you would earn a total of 791.00 from holding GAMESTOP or generate 38.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
GAMESTOP vs. Universal Display
Performance |
| Timeline |
| GAMESTOP |
| Universal Display |
GAMESTOP and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMESTOP and Universal Display
The main advantage of trading using opposite GAMESTOP and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMESTOP position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| GAMESTOP vs. UNIVERSAL MUSIC GROUP | GAMESTOP vs. GALENA MINING LTD | GAMESTOP vs. Boyd Gaming | GAMESTOP vs. Penn National Gaming |
| Universal Display vs. TROPHY GAMES DEV | Universal Display vs. Penn National Gaming | Universal Display vs. CVW CLEANTECH INC | Universal Display vs. GAMESTOP |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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