Correlation Between PATTIES FOODS and ELECTRONIC ARTS
Can any of the company-specific risk be diversified away by investing in both PATTIES FOODS and ELECTRONIC ARTS 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 PATTIES FOODS and ELECTRONIC ARTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PATTIES FOODS and ELECTRONIC ARTS, you can compare the effects of market volatilities on PATTIES FOODS and ELECTRONIC ARTS 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 PATTIES FOODS with a short position of ELECTRONIC ARTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of PATTIES FOODS and ELECTRONIC ARTS.
Diversification Opportunities for PATTIES FOODS and ELECTRONIC ARTS
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PATTIES and ELECTRONIC is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PATTIES FOODS and ELECTRONIC ARTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELECTRONIC ARTS and PATTIES FOODS 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 PATTIES FOODS are associated (or correlated) with ELECTRONIC ARTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELECTRONIC ARTS has no effect on the direction of PATTIES FOODS i.e., PATTIES FOODS and ELECTRONIC ARTS go up and down completely randomly.
Pair Corralation between PATTIES FOODS and ELECTRONIC ARTS
Assuming the 90 days horizon PATTIES FOODS is expected to generate 0.95 times more return on investment than ELECTRONIC ARTS. However, PATTIES FOODS is 1.06 times less risky than ELECTRONIC ARTS. It trades about 0.07 of its potential returns per unit of risk. ELECTRONIC ARTS is currently generating about -0.3 per unit of risk. If you would invest 27.00 in PATTIES FOODS on November 4, 2024 and sell it today you would earn a total of 1.00 from holding PATTIES FOODS or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
PATTIES FOODS vs. ELECTRONIC ARTS
Performance |
| Timeline |
| PATTIES FOODS |
| ELECTRONIC ARTS |
PATTIES FOODS and ELECTRONIC ARTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PATTIES FOODS and ELECTRONIC ARTS
The main advantage of trading using opposite PATTIES FOODS and ELECTRONIC ARTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PATTIES FOODS position performs unexpectedly, ELECTRONIC ARTS 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 ELECTRONIC ARTS will offset losses from the drop in ELECTRONIC ARTS's long position.| PATTIES FOODS vs. UNIVMUSIC GRPADR050 | PATTIES FOODS vs. Bio Techne Corp | PATTIES FOODS vs. VELA TECHNOLPLC LS 0001 | PATTIES FOODS vs. Warner Music Group |
| ELECTRONIC ARTS vs. CHINA EDUCATION GROUP | ELECTRONIC ARTS vs. Norwegian Air Shuttle | ELECTRONIC ARTS vs. Corsair Gaming | ELECTRONIC ARTS vs. SYSTEMAIR 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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