Correlation Between Live Motion and Play2Chill
Can any of the company-specific risk be diversified away by investing in both Live Motion and Play2Chill 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 Live Motion and Play2Chill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Motion Games and Play2Chill SA, you can compare the effects of market volatilities on Live Motion and Play2Chill 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 Live Motion with a short position of Play2Chill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Motion and Play2Chill.
Diversification Opportunities for Live Motion and Play2Chill
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Live and Play2Chill is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Live Motion Games and Play2Chill SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Play2Chill SA and Live Motion 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 Live Motion Games are associated (or correlated) with Play2Chill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Play2Chill SA has no effect on the direction of Live Motion i.e., Live Motion and Play2Chill go up and down completely randomly.
Pair Corralation between Live Motion and Play2Chill
Assuming the 90 days trading horizon Live Motion Games is expected to under-perform the Play2Chill. But the stock apears to be less risky and, when comparing its historical volatility, Live Motion Games is 1.09 times less risky than Play2Chill. The stock trades about -0.52 of its potential returns per unit of risk. The Play2Chill SA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 410.00 in Play2Chill SA on September 14, 2024 and sell it today you would earn a total of 4.00 from holding Play2Chill SA or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Motion Games vs. Play2Chill SA
Performance |
| Timeline |
| Live Motion Games |
| Play2Chill SA |
Live Motion and Play2Chill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Motion and Play2Chill
The main advantage of trading using opposite Live Motion and Play2Chill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Motion position performs unexpectedly, Play2Chill 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 Play2Chill will offset losses from the drop in Play2Chill's long position.| Live Motion vs. Creativeforge Games SA | Live Motion vs. ECC Games SA | Live Motion vs. Asseco Business Solutions | Live Motion vs. Asseco South Eastern |
| Play2Chill vs. NGG | Play2Chill vs. Asseco Business Solutions | Play2Chill vs. Asseco South Eastern | Play2Chill vs. HM Inwest 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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