Correlation Between Light Wonder and Good Gaming
Can any of the company-specific risk be diversified away by investing in both Light Wonder and Good 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 Light Wonder and Good Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Light Wonder and Good Gaming, you can compare the effects of market volatilities on Light Wonder and Good 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 Light Wonder with a short position of Good Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Light Wonder and Good Gaming.
Diversification Opportunities for Light Wonder and Good Gaming
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Light and Good is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Light Wonder and Good Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Good Gaming and Light Wonder 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 Light Wonder are associated (or correlated) with Good Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Good Gaming has no effect on the direction of Light Wonder i.e., Light Wonder and Good Gaming go up and down completely randomly.
Pair Corralation between Light Wonder and Good Gaming
Considering the 90-day investment horizon Light Wonder is expected to generate 0.27 times more return on investment than Good Gaming. However, Light Wonder is 3.68 times less risky than Good Gaming. It trades about 0.05 of its potential returns per unit of risk. Good Gaming is currently generating about 0.0 per unit of risk. If you would invest 6,362 in Light Wonder on August 24, 2024 and sell it today you would earn a total of 3,280 from holding Light Wonder or generate 51.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Light Wonder vs. Good Gaming
Performance |
| Timeline |
| Light Wonder |
| Good Gaming |
Light Wonder and Good Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Light Wonder and Good Gaming
The main advantage of trading using opposite Light Wonder and Good Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Light Wonder position performs unexpectedly, Good 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 Good Gaming will offset losses from the drop in Good Gaming's long position.| Light Wonder vs. Codere Online Corp | Light Wonder vs. Inspired Entertainment | Light Wonder vs. International Game Technology | Light Wonder vs. Accel Entertainment |
| Good Gaming vs. Real Luck Group | Good Gaming vs. Betmakers Technology Group | Good Gaming vs. Jackpot Digital |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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