Correlation Between RETAIL FOOD and CONTAGIOUS GAMING
Can any of the company-specific risk be diversified away by investing in both RETAIL FOOD 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 RETAIL FOOD and CONTAGIOUS GAMING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RETAIL FOOD GROUP and CONTAGIOUS GAMING INC, you can compare the effects of market volatilities on RETAIL FOOD 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 RETAIL FOOD with a short position of CONTAGIOUS GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of RETAIL FOOD and CONTAGIOUS GAMING.
Diversification Opportunities for RETAIL FOOD and CONTAGIOUS GAMING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between RETAIL and CONTAGIOUS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding RETAIL FOOD GROUP and CONTAGIOUS GAMING INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONTAGIOUS GAMING INC and RETAIL FOOD 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 RETAIL FOOD GROUP 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 INC has no effect on the direction of RETAIL FOOD i.e., RETAIL FOOD and CONTAGIOUS GAMING go up and down completely randomly.
Pair Corralation between RETAIL FOOD and CONTAGIOUS GAMING
Assuming the 90 days trading horizon RETAIL FOOD GROUP is expected to under-perform the CONTAGIOUS GAMING. But the stock apears to be less risky and, when comparing its historical volatility, RETAIL FOOD GROUP is 40.67 times less risky than CONTAGIOUS GAMING. The stock trades about -0.03 of its potential returns per unit of risk. The CONTAGIOUS GAMING INC is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 0.15 in CONTAGIOUS GAMING INC on October 29, 2024 and sell it today you would earn a total of 0.15 from holding CONTAGIOUS GAMING INC or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
RETAIL FOOD GROUP vs. CONTAGIOUS GAMING INC
Performance |
| Timeline |
| RETAIL FOOD GROUP |
| CONTAGIOUS GAMING INC |
RETAIL FOOD and CONTAGIOUS GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RETAIL FOOD and CONTAGIOUS GAMING
The main advantage of trading using opposite RETAIL FOOD and CONTAGIOUS GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RETAIL FOOD 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.| RETAIL FOOD vs. Salesforce | RETAIL FOOD vs. Lamar Advertising | RETAIL FOOD vs. Richardson Electronics | RETAIL FOOD vs. PACIFIC ONLINE |
| CONTAGIOUS GAMING vs. Japan Asia Investment | CONTAGIOUS GAMING vs. Apollo Investment Corp | CONTAGIOUS GAMING vs. ECHO INVESTMENT ZY | CONTAGIOUS GAMING vs. Eidesvik Offshore ASA |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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