Correlation Between ING Bank and Gaming Factory
Can any of the company-specific risk be diversified away by investing in both ING Bank and Gaming Factory 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 ING Bank and Gaming Factory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ING Bank lski and Gaming Factory SA, you can compare the effects of market volatilities on ING Bank and Gaming Factory 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 ING Bank with a short position of Gaming Factory. Check out your portfolio center. Please also check ongoing floating volatility patterns of ING Bank and Gaming Factory.
Diversification Opportunities for ING Bank and Gaming Factory
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ING and Gaming is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding ING Bank lski and Gaming Factory SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaming Factory SA and ING Bank 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 ING Bank lski are associated (or correlated) with Gaming Factory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaming Factory SA has no effect on the direction of ING Bank i.e., ING Bank and Gaming Factory go up and down completely randomly.
Pair Corralation between ING Bank and Gaming Factory
Assuming the 90 days trading horizon ING Bank lski is expected to generate 0.57 times more return on investment than Gaming Factory. However, ING Bank lski is 1.74 times less risky than Gaming Factory. It trades about 0.0 of its potential returns per unit of risk. Gaming Factory SA is currently generating about -0.04 per unit of risk. If you would invest 30,150 in ING Bank lski on November 28, 2024 and sell it today you would lose (1,200) from holding ING Bank lski or give up 3.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ING Bank lski vs. Gaming Factory SA
Performance |
| Timeline |
| ING Bank lski |
| Gaming Factory SA |
ING Bank and Gaming Factory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ING Bank and Gaming Factory
The main advantage of trading using opposite ING Bank and Gaming Factory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ING Bank position performs unexpectedly, Gaming Factory 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 Gaming Factory will offset losses from the drop in Gaming Factory's long position.| ING Bank vs. Enter Air SA | ING Bank vs. GreenX Metals | ING Bank vs. X Trade Brokers | ING Bank vs. Mercator Medical SA |
| Gaming Factory vs. Datawalk SA | Gaming Factory vs. Play2Chill SA | Gaming Factory vs. Skyline Investment SA | Gaming Factory vs. Echo Investment SA |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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