Correlation Between LION ONE and MOVIE GAMES
Can any of the company-specific risk be diversified away by investing in both LION ONE and MOVIE GAMES 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 LION ONE and MOVIE GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LION ONE METALS and MOVIE GAMES SA, you can compare the effects of market volatilities on LION ONE and MOVIE GAMES 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 LION ONE with a short position of MOVIE GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of LION ONE and MOVIE GAMES.
Diversification Opportunities for LION ONE and MOVIE GAMES
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LION and MOVIE is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding LION ONE METALS and MOVIE GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOVIE GAMES SA and LION ONE 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 LION ONE METALS are associated (or correlated) with MOVIE GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOVIE GAMES SA has no effect on the direction of LION ONE i.e., LION ONE and MOVIE GAMES go up and down completely randomly.
Pair Corralation between LION ONE and MOVIE GAMES
Assuming the 90 days trading horizon LION ONE METALS is expected to generate 1.65 times more return on investment than MOVIE GAMES. However, LION ONE is 1.65 times more volatile than MOVIE GAMES SA. It trades about -0.05 of its potential returns per unit of risk. MOVIE GAMES SA is currently generating about -0.23 per unit of risk. If you would invest 21.00 in LION ONE METALS on September 3, 2024 and sell it today you would lose (1.00) from holding LION ONE METALS or give up 4.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LION ONE METALS vs. MOVIE GAMES SA
Performance |
| Timeline |
| LION ONE METALS |
| MOVIE GAMES SA |
LION ONE and MOVIE GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LION ONE and MOVIE GAMES
The main advantage of trading using opposite LION ONE and MOVIE GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LION ONE position performs unexpectedly, MOVIE GAMES 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 MOVIE GAMES will offset losses from the drop in MOVIE GAMES's long position.| LION ONE vs. HomeToGo SE | LION ONE vs. NORTHEAST UTILITIES | LION ONE vs. SBM OFFSHORE | LION ONE vs. Zijin Mining Group |
| MOVIE GAMES vs. LION ONE METALS | MOVIE GAMES vs. Silicon Motion Technology | MOVIE GAMES vs. Perseus Mining Limited | MOVIE GAMES vs. China BlueChemical |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |