Correlation Between CONTAGIOUS GAMING and United Utilities
Can any of the company-specific risk be diversified away by investing in both CONTAGIOUS GAMING and United Utilities 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 CONTAGIOUS GAMING and United Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CONTAGIOUS GAMING INC and United Utilities Group, you can compare the effects of market volatilities on CONTAGIOUS GAMING and United Utilities 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 CONTAGIOUS GAMING with a short position of United Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of CONTAGIOUS GAMING and United Utilities.
Diversification Opportunities for CONTAGIOUS GAMING and United Utilities
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CONTAGIOUS and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CONTAGIOUS GAMING INC and United Utilities Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Utilities and CONTAGIOUS GAMING 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 CONTAGIOUS GAMING INC are associated (or correlated) with United Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Utilities has no effect on the direction of CONTAGIOUS GAMING i.e., CONTAGIOUS GAMING and United Utilities go up and down completely randomly.
Pair Corralation between CONTAGIOUS GAMING and United Utilities
Assuming the 90 days trading horizon CONTAGIOUS GAMING INC is expected to generate 53.33 times more return on investment than United Utilities. However, CONTAGIOUS GAMING is 53.33 times more volatile than United Utilities Group. It trades about 0.14 of its potential returns per unit of risk. United Utilities Group is currently generating about 0.02 per unit of risk. If you would invest 0.60 in CONTAGIOUS GAMING INC on November 8, 2024 and sell it today you would lose (0.30) from holding CONTAGIOUS GAMING INC or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
CONTAGIOUS GAMING INC vs. United Utilities Group
Performance |
| Timeline |
| CONTAGIOUS GAMING INC |
| United Utilities |
CONTAGIOUS GAMING and United Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CONTAGIOUS GAMING and United Utilities
The main advantage of trading using opposite CONTAGIOUS GAMING and United Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CONTAGIOUS GAMING position performs unexpectedly, United Utilities 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 United Utilities will offset losses from the drop in United Utilities' long position.| CONTAGIOUS GAMING vs. Axfood AB | CONTAGIOUS GAMING vs. Adtalem Global Education | CONTAGIOUS GAMING vs. CAL MAINE FOODS | CONTAGIOUS GAMING vs. PLANT VEDA FOODS |
| United Utilities vs. UPDATE SOFTWARE | United Utilities vs. PKSHA TECHNOLOGY INC | United Utilities vs. ASURE SOFTWARE | United Utilities vs. China Datang |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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