Correlation Between North American and CI GAMES
Can any of the company-specific risk be diversified away by investing in both North American and CI 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 North American and CI GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between North American Construction and CI GAMES SA, you can compare the effects of market volatilities on North American and CI 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 North American with a short position of CI GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of North American and CI GAMES.
Diversification Opportunities for North American and CI GAMES
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between North and CI7 is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding North American Construction and CI GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI GAMES SA and North American 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 North American Construction are associated (or correlated) with CI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI GAMES SA has no effect on the direction of North American i.e., North American and CI GAMES go up and down completely randomly.
Pair Corralation between North American and CI GAMES
Assuming the 90 days horizon North American Construction is expected to generate 0.63 times more return on investment than CI GAMES. However, North American Construction is 1.59 times less risky than CI GAMES. It trades about 0.08 of its potential returns per unit of risk. CI GAMES SA is currently generating about -0.03 per unit of risk. If you would invest 1,868 in North American Construction on September 13, 2024 and sell it today you would earn a total of 62.00 from holding North American Construction or generate 3.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
North American Construction vs. CI GAMES SA
Performance |
| Timeline |
| North American Const |
| CI GAMES SA |
North American and CI GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North American and CI GAMES
The main advantage of trading using opposite North American and CI GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North American position performs unexpectedly, CI 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 CI GAMES will offset losses from the drop in CI GAMES's long position.| North American vs. Tenaris SA | North American vs. NOV Inc | North American vs. Superior Plus Corp | North American vs. SIVERS SEMICONDUCTORS AB |
| CI GAMES vs. NEXON Co | CI GAMES vs. Take Two Interactive Software | CI GAMES vs. Superior Plus Corp | CI GAMES vs. SIVERS SEMICONDUCTORS AB |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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