Correlation Between SFL and Galaxy Entertainment
Can any of the company-specific risk be diversified away by investing in both SFL and Galaxy Entertainment 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 SFL and Galaxy Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SFL Corporation and Galaxy Entertainment Group, you can compare the effects of market volatilities on SFL and Galaxy Entertainment 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 SFL with a short position of Galaxy Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SFL and Galaxy Entertainment.
Diversification Opportunities for SFL and Galaxy Entertainment
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SFL and Galaxy is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding SFL Corp. and Galaxy Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Entertainment and SFL 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 SFL Corporation are associated (or correlated) with Galaxy Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galaxy Entertainment has no effect on the direction of SFL i.e., SFL and Galaxy Entertainment go up and down completely randomly.
Pair Corralation between SFL and Galaxy Entertainment
Considering the 90-day investment horizon SFL Corporation is expected to generate 0.96 times more return on investment than Galaxy Entertainment. However, SFL Corporation is 1.04 times less risky than Galaxy Entertainment. It trades about 0.05 of its potential returns per unit of risk. Galaxy Entertainment Group is currently generating about -0.19 per unit of risk. If you would invest 1,086 in SFL Corporation on August 25, 2024 and sell it today you would earn a total of 13.00 from holding SFL Corporation or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SFL Corp. vs. Galaxy Entertainment Group
Performance |
| Timeline |
| SFL Corporation |
| Galaxy Entertainment |
SFL and Galaxy Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SFL and Galaxy Entertainment
The main advantage of trading using opposite SFL and Galaxy Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SFL position performs unexpectedly, Galaxy Entertainment 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 Galaxy Entertainment will offset losses from the drop in Galaxy Entertainment's long position.The idea behind SFL Corporation and Galaxy Entertainment 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.| Galaxy Entertainment vs. SFL Corporation | Galaxy Entertainment vs. Enersys | Galaxy Entertainment vs. Franklin Credit Management | Galaxy Entertainment vs. CECO Environmental Corp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |