Correlation Between Supermarket Income and Games Workshop
Can any of the company-specific risk be diversified away by investing in both Supermarket Income and Games Workshop 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 Supermarket Income and Games Workshop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supermarket Income REIT and Games Workshop Group, you can compare the effects of market volatilities on Supermarket Income and Games Workshop 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 Supermarket Income with a short position of Games Workshop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supermarket Income and Games Workshop.
Diversification Opportunities for Supermarket Income and Games Workshop
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Supermarket and Games is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Supermarket Income REIT and Games Workshop Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Games Workshop Group and Supermarket Income 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 Supermarket Income REIT are associated (or correlated) with Games Workshop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Games Workshop Group has no effect on the direction of Supermarket Income i.e., Supermarket Income and Games Workshop go up and down completely randomly.
Pair Corralation between Supermarket Income and Games Workshop
Assuming the 90 days trading horizon Supermarket Income is expected to generate 18.48 times less return on investment than Games Workshop. But when comparing it to its historical volatility, Supermarket Income REIT is 1.23 times less risky than Games Workshop. It trades about 0.0 of its potential returns per unit of risk. Games Workshop Group is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 912,370 in Games Workshop Group on September 2, 2024 and sell it today you would earn a total of 500,630 from holding Games Workshop Group or generate 54.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supermarket Income REIT vs. Games Workshop Group
Performance |
| Timeline |
| Supermarket Income REIT |
| Games Workshop Group |
Supermarket Income and Games Workshop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supermarket Income and Games Workshop
The main advantage of trading using opposite Supermarket Income and Games Workshop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supermarket Income position performs unexpectedly, Games Workshop 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 Games Workshop will offset losses from the drop in Games Workshop's long position.| Supermarket Income vs. Derwent London PLC | Supermarket Income vs. Workspace Group PLC | Supermarket Income vs. Diversified Energy | Supermarket Income vs. Thyssenkrupp AG ON |
| Games Workshop vs. Uniper SE | Games Workshop vs. Mulberry Group PLC | Games Workshop vs. London Security Plc | Games Workshop vs. Triad Group PLC |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |