Correlation Between SJM Holdings and Galaxy Entertainment
Can any of the company-specific risk be diversified away by investing in both SJM Holdings 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 SJM Holdings and Galaxy Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SJM Holdings Ltd and Galaxy Entertainment Group, you can compare the effects of market volatilities on SJM Holdings 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 SJM Holdings with a short position of Galaxy Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SJM Holdings and Galaxy Entertainment.
Diversification Opportunities for SJM Holdings and Galaxy Entertainment
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SJM and Galaxy is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding SJM Holdings Ltd and Galaxy Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Entertainment and SJM Holdings 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 SJM Holdings Ltd 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 SJM Holdings i.e., SJM Holdings and Galaxy Entertainment go up and down completely randomly.
Pair Corralation between SJM Holdings and Galaxy Entertainment
Assuming the 90 days horizon SJM Holdings Ltd is expected to under-perform the Galaxy Entertainment. In addition to that, SJM Holdings is 2.13 times more volatile than Galaxy Entertainment Group. It trades about -0.22 of its total potential returns per unit of risk. Galaxy Entertainment Group is currently generating about -0.04 per unit of volatility. If you would invest 2,166 in Galaxy Entertainment Group on August 25, 2024 and sell it today you would lose (66.00) from holding Galaxy Entertainment Group or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SJM Holdings Ltd vs. Galaxy Entertainment Group
Performance |
| Timeline |
| SJM Holdings |
| Galaxy Entertainment |
SJM Holdings and Galaxy Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SJM Holdings and Galaxy Entertainment
The main advantage of trading using opposite SJM Holdings and Galaxy Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SJM Holdings 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.| SJM Holdings vs. Sands China Ltd | SJM Holdings vs. Studio City International | SJM Holdings vs. Monarch Casino Resort | SJM Holdings vs. Playa Hotels Resorts |
| Galaxy Entertainment vs. SJM Holdings Ltd | Galaxy Entertainment vs. Studio City International | Galaxy Entertainment vs. Monarch Casino Resort | Galaxy Entertainment vs. Playa Hotels Resorts |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |