Correlation Between Intuitive Investments and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Intuitive Investments and Electronic Arts 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 Intuitive Investments and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intuitive Investments Group and Electronic Arts, you can compare the effects of market volatilities on Intuitive Investments and Electronic Arts 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 Intuitive Investments with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intuitive Investments and Electronic Arts.
Diversification Opportunities for Intuitive Investments and Electronic Arts
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intuitive and Electronic is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Investments Group and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Intuitive Investments 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 Intuitive Investments Group are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Intuitive Investments i.e., Intuitive Investments and Electronic Arts go up and down completely randomly.
Pair Corralation between Intuitive Investments and Electronic Arts
Assuming the 90 days trading horizon Intuitive Investments Group is expected to under-perform the Electronic Arts. In addition to that, Intuitive Investments is 1.41 times more volatile than Electronic Arts. It trades about -0.01 of its total potential returns per unit of risk. Electronic Arts is currently generating about 0.73 per unit of volatility. If you would invest 14,492 in Electronic Arts on August 24, 2024 and sell it today you would earn a total of 2,241 from holding Electronic Arts or generate 15.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intuitive Investments Group vs. Electronic Arts
Performance |
| Timeline |
| Intuitive Investments |
| Electronic Arts |
Intuitive Investments and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intuitive Investments and Electronic Arts
The main advantage of trading using opposite Intuitive Investments and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intuitive Investments position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Intuitive Investments vs. Home Depot | Intuitive Investments vs. River and Mercantile | Intuitive Investments vs. Chrysalis Investments | Intuitive Investments vs. Sherborne Investors Guernsey |
| Electronic Arts vs. Quadrise Plc | Electronic Arts vs. Intuitive Investments Group | Electronic Arts vs. European Metals Holdings | Electronic Arts vs. Athelney Trust plc |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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