Correlation Between Nintendo and CI GAMES
Can any of the company-specific risk be diversified away by investing in both Nintendo 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 Nintendo and CI GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nintendo Co and CI GAMES SA, you can compare the effects of market volatilities on Nintendo 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 Nintendo with a short position of CI GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nintendo and CI GAMES.
Diversification Opportunities for Nintendo and CI GAMES
Very good diversification
The 3 months correlation between Nintendo and CI7 is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Nintendo Co 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 Nintendo 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 Nintendo Co 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 Nintendo i.e., Nintendo and CI GAMES go up and down completely randomly.
Pair Corralation between Nintendo and CI GAMES
Assuming the 90 days trading horizon Nintendo Co is expected to generate 0.95 times more return on investment than CI GAMES. However, Nintendo Co is 1.06 times less risky than CI GAMES. It trades about 0.21 of its potential returns per unit of risk. CI GAMES SA is currently generating about -0.02 per unit of risk. If you would invest 1,180 in Nintendo Co on September 4, 2024 and sell it today you would earn a total of 180.00 from holding Nintendo Co or generate 15.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Nintendo Co vs. CI GAMES SA
Performance |
| Timeline |
| Nintendo |
| CI GAMES SA |
Nintendo and CI GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nintendo and CI GAMES
The main advantage of trading using opposite Nintendo and CI GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nintendo 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.| Nintendo vs. ADRIATIC METALS LS 013355 | Nintendo vs. Cleanaway Waste Management | Nintendo vs. ALERION CLEANPOWER | Nintendo vs. ePlay Digital |
| CI GAMES vs. CDN IMPERIAL BANK | CI GAMES vs. VIRG NATL BANKSH | CI GAMES vs. ADRIATIC METALS LS 013355 | CI GAMES vs. GREENX METALS LTD |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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