Correlation Between Securitas and Fractal Gaming
Can any of the company-specific risk be diversified away by investing in both Securitas and Fractal Gaming 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 Securitas and Fractal Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Securitas AB and Fractal Gaming Group, you can compare the effects of market volatilities on Securitas and Fractal Gaming 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 Securitas with a short position of Fractal Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Securitas and Fractal Gaming.
Diversification Opportunities for Securitas and Fractal Gaming
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Securitas and Fractal is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Securitas AB and Fractal Gaming Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fractal Gaming Group and Securitas 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 Securitas AB are associated (or correlated) with Fractal Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fractal Gaming Group has no effect on the direction of Securitas i.e., Securitas and Fractal Gaming go up and down completely randomly.
Pair Corralation between Securitas and Fractal Gaming
Assuming the 90 days trading horizon Securitas AB is expected to under-perform the Fractal Gaming. But the stock apears to be less risky and, when comparing its historical volatility, Securitas AB is 3.19 times less risky than Fractal Gaming. The stock trades about -0.08 of its potential returns per unit of risk. The Fractal Gaming Group is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 3,080 in Fractal Gaming Group on October 22, 2024 and sell it today you would earn a total of 320.00 from holding Fractal Gaming Group or generate 10.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Securitas AB vs. Fractal Gaming Group
Performance |
| Timeline |
| Securitas AB |
| Fractal Gaming Group |
Securitas and Fractal Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Securitas and Fractal Gaming
The main advantage of trading using opposite Securitas and Fractal Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Securitas position performs unexpectedly, Fractal Gaming 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 Fractal Gaming will offset losses from the drop in Fractal Gaming's long position.The idea behind Securitas AB and Fractal Gaming Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fractal Gaming vs. Media and Games | Fractal Gaming vs. Cint Group AB | Fractal Gaming vs. Thunderful Group AB | Fractal Gaming vs. Enad Global 7 |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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