Correlation Between Sea and GameSquare Holdings
Can any of the company-specific risk be diversified away by investing in both Sea and GameSquare Holdings 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 Sea and GameSquare Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sea and GameSquare Holdings, you can compare the effects of market volatilities on Sea and GameSquare Holdings 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 Sea with a short position of GameSquare Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sea and GameSquare Holdings.
Diversification Opportunities for Sea and GameSquare Holdings
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sea and GameSquare is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sea and GameSquare Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GameSquare Holdings and Sea 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 Sea are associated (or correlated) with GameSquare Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GameSquare Holdings has no effect on the direction of Sea i.e., Sea and GameSquare Holdings go up and down completely randomly.
Pair Corralation between Sea and GameSquare Holdings
Allowing for the 90-day total investment horizon Sea is expected to generate 1.27 times less return on investment than GameSquare Holdings. But when comparing it to its historical volatility, Sea is 2.07 times less risky than GameSquare Holdings. It trades about 0.21 of its potential returns per unit of risk. GameSquare Holdings is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 76.00 in GameSquare Holdings on August 27, 2024 and sell it today you would earn a total of 11.00 from holding GameSquare Holdings or generate 14.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sea vs. GameSquare Holdings
Performance |
| Timeline |
| Sea |
| GameSquare Holdings |
Sea and GameSquare Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sea and GameSquare Holdings
The main advantage of trading using opposite Sea and GameSquare Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sea position performs unexpectedly, GameSquare Holdings 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 GameSquare Holdings will offset losses from the drop in GameSquare Holdings' long position.| Sea vs. Atari SA | Sea vs. Victory Square Technologies | Sea vs. Motorsport Gaming Us | Sea vs. Alpha Esports Tech |
| GameSquare Holdings vs. AEye Inc | GameSquare Holdings vs. Arqit Quantum Warrants | GameSquare Holdings vs. Xos Equity Warrants |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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