Correlation Between Intersport Polska and Varsav Game
Can any of the company-specific risk be diversified away by investing in both Intersport Polska and Varsav Game 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 Intersport Polska and Varsav Game into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intersport Polska SA and Varsav Game Studios, you can compare the effects of market volatilities on Intersport Polska and Varsav Game 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 Intersport Polska with a short position of Varsav Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intersport Polska and Varsav Game.
Diversification Opportunities for Intersport Polska and Varsav Game
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Intersport and Varsav is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Intersport Polska SA and Varsav Game Studios in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Varsav Game Studios and Intersport Polska 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 Intersport Polska SA are associated (or correlated) with Varsav Game. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Varsav Game Studios has no effect on the direction of Intersport Polska i.e., Intersport Polska and Varsav Game go up and down completely randomly.
Pair Corralation between Intersport Polska and Varsav Game
Assuming the 90 days trading horizon Intersport Polska SA is expected to generate 1.33 times more return on investment than Varsav Game. However, Intersport Polska is 1.33 times more volatile than Varsav Game Studios. It trades about 0.21 of its potential returns per unit of risk. Varsav Game Studios is currently generating about -0.02 per unit of risk. If you would invest 63.00 in Intersport Polska SA on August 31, 2024 and sell it today you would earn a total of 16.00 from holding Intersport Polska SA or generate 25.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intersport Polska SA vs. Varsav Game Studios
Performance |
| Timeline |
| Intersport Polska |
| Varsav Game Studios |
Intersport Polska and Varsav Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intersport Polska and Varsav Game
The main advantage of trading using opposite Intersport Polska and Varsav Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intersport Polska position performs unexpectedly, Varsav Game 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 Varsav Game will offset losses from the drop in Varsav Game's long position.| Intersport Polska vs. Asseco Business Solutions | Intersport Polska vs. Detalion Games SA | Intersport Polska vs. Asseco South Eastern | Intersport Polska vs. CFI Holding SA |
| Varsav Game vs. Banco Santander SA | Varsav Game vs. UniCredit SpA | Varsav Game vs. CEZ as | Varsav Game vs. Polski Koncern Naftowy |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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