Correlation Between Movie Games and APS Energia
Can any of the company-specific risk be diversified away by investing in both Movie Games and APS Energia 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 Movie Games and APS Energia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Movie Games SA and APS Energia SA, you can compare the effects of market volatilities on Movie Games and APS Energia 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 Movie Games with a short position of APS Energia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Movie Games and APS Energia.
Diversification Opportunities for Movie Games and APS Energia
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Movie and APS is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Movie Games SA and APS Energia SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APS Energia SA and Movie Games 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 Movie Games SA are associated (or correlated) with APS Energia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APS Energia SA has no effect on the direction of Movie Games i.e., Movie Games and APS Energia go up and down completely randomly.
Pair Corralation between Movie Games and APS Energia
Assuming the 90 days trading horizon Movie Games SA is expected to under-perform the APS Energia. But the stock apears to be less risky and, when comparing its historical volatility, Movie Games SA is 2.43 times less risky than APS Energia. The stock trades about -0.25 of its potential returns per unit of risk. The APS Energia SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 235.00 in APS Energia SA on August 26, 2024 and sell it today you would earn a total of 11.00 from holding APS Energia SA or generate 4.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Movie Games SA vs. APS Energia SA
Performance |
| Timeline |
| Movie Games SA |
| APS Energia SA |
Movie Games and APS Energia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Movie Games and APS Energia
The main advantage of trading using opposite Movie Games and APS Energia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Movie Games position performs unexpectedly, APS Energia 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 APS Energia will offset losses from the drop in APS Energia's long position.| Movie Games vs. CD PROJEKT SA | Movie Games vs. 11 bit studios | Movie Games vs. Ultimate Games SA | Movie Games vs. Gaming Factory SA |
| APS Energia vs. True Games Syndicate | APS Energia vs. Carlson Investments SA | APS Energia vs. CI Games SA | APS Energia vs. Saule Technologies 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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