Correlation Between Movie Games and TEN SQUARE
Can any of the company-specific risk be diversified away by investing in both Movie Games and TEN SQUARE 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 TEN SQUARE 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 TEN SQUARE GAMES, you can compare the effects of market volatilities on Movie Games and TEN SQUARE 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 TEN SQUARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Movie Games and TEN SQUARE.
Diversification Opportunities for Movie Games and TEN SQUARE
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Movie and TEN is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Movie Games SA and TEN SQUARE GAMES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TEN SQUARE GAMES 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 TEN SQUARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TEN SQUARE GAMES has no effect on the direction of Movie Games i.e., Movie Games and TEN SQUARE go up and down completely randomly.
Pair Corralation between Movie Games and TEN SQUARE
Assuming the 90 days trading horizon Movie Games SA is expected to under-perform the TEN SQUARE. In addition to that, Movie Games is 1.71 times more volatile than TEN SQUARE GAMES. It trades about -0.04 of its total potential returns per unit of risk. TEN SQUARE GAMES is currently generating about -0.03 per unit of volatility. If you would invest 9,640 in TEN SQUARE GAMES on August 25, 2024 and sell it today you would lose (1,610) from holding TEN SQUARE GAMES or give up 16.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Movie Games SA vs. TEN SQUARE GAMES
Performance |
| Timeline |
| Movie Games SA |
| TEN SQUARE GAMES |
Movie Games and TEN SQUARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Movie Games and TEN SQUARE
The main advantage of trading using opposite Movie Games and TEN SQUARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Movie Games position performs unexpectedly, TEN SQUARE 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 TEN SQUARE will offset losses from the drop in TEN SQUARE'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 |
| TEN SQUARE vs. CD PROJEKT SA | TEN SQUARE vs. 11 bit studios | TEN SQUARE vs. Movie Games SA | TEN SQUARE vs. Ultimate Games 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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