Correlation Between HOME DEPOT and Contagious Gaming

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both HOME DEPOT and Contagious Gaming 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 HOME DEPOT and Contagious Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HOME DEPOT CDR and Contagious Gaming, you can compare the effects of market volatilities on HOME DEPOT and Contagious Gaming 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 HOME DEPOT with a short position of Contagious Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOME DEPOT and Contagious Gaming.

Diversification Opportunities for HOME DEPOT and Contagious Gaming

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between HOME and Contagious is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HOME DEPOT CDR and Contagious Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contagious Gaming and HOME DEPOT 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 HOME DEPOT CDR are associated (or correlated) with Contagious Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contagious Gaming has no effect on the direction of HOME DEPOT i.e., HOME DEPOT and Contagious Gaming go up and down completely randomly.

Pair Corralation between HOME DEPOT and Contagious Gaming

Assuming the 90 days trading horizon HOME DEPOT is expected to generate 3.36 times less return on investment than Contagious Gaming. But when comparing it to its historical volatility, HOME DEPOT CDR is 5.71 times less risky than Contagious Gaming. It trades about 0.05 of its potential returns per unit of risk. Contagious Gaming is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1.00  in Contagious Gaming on September 6, 2024 and sell it today you would earn a total of  0.00  from holding Contagious Gaming or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy99.8%
ValuesDaily Returns

HOME DEPOT CDR  vs.  Contagious Gaming

 Performance 
       Timeline  
HOME DEPOT CDR 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in HOME DEPOT CDR are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, HOME DEPOT displayed solid returns over the last few months and may actually be approaching a breakup point.
Contagious Gaming 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Contagious Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Contagious Gaming is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

HOME DEPOT and Contagious Gaming Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with HOME DEPOT and Contagious Gaming

The main advantage of trading using opposite HOME DEPOT and Contagious Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HOME DEPOT position performs unexpectedly, Contagious Gaming 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 Contagious Gaming will offset losses from the drop in Contagious Gaming's long position.
The idea behind HOME DEPOT CDR and Contagious Gaming 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.
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

Other Complementary Tools

Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios