Correlation Between Take Two and CBRE
Can any of the company-specific risk be diversified away by investing in both Take Two and CBRE 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 Take Two and CBRE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Take Two Interactive Software and CBRE Group, you can compare the effects of market volatilities on Take Two and CBRE 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 Take Two with a short position of CBRE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Take Two and CBRE.
Diversification Opportunities for Take Two and CBRE
Very poor diversification
The 3 months correlation between Take and CBRE is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Take Two Interactive Software and CBRE Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBRE Group and Take Two 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 Take Two Interactive Software are associated (or correlated) with CBRE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBRE Group has no effect on the direction of Take Two i.e., Take Two and CBRE go up and down completely randomly.
Pair Corralation between Take Two and CBRE
Assuming the 90 days trading horizon Take Two Interactive Software is expected to generate 0.77 times more return on investment than CBRE. However, Take Two Interactive Software is 1.31 times less risky than CBRE. It trades about 0.09 of its potential returns per unit of risk. CBRE Group is currently generating about 0.07 per unit of risk. If you would invest 13,563 in Take Two Interactive Software on September 2, 2024 and sell it today you would earn a total of 14,779 from holding Take Two Interactive Software or generate 108.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.8% |
| Values | Daily Returns |
Take Two Interactive Software vs. CBRE Group
Performance |
| Timeline |
| Take Two Interactive |
| CBRE Group |
Take Two and CBRE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Take Two and CBRE
The main advantage of trading using opposite Take Two and CBRE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Take Two position performs unexpectedly, CBRE 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 CBRE will offset losses from the drop in CBRE's long position.| Take Two vs. Fras le SA | Take Two vs. Energisa SA | Take Two vs. Clave Indices De | Take Two vs. BTG Pactual Logstica |
| CBRE vs. Raytheon Technologies | CBRE vs. Zoom Video Communications | CBRE vs. Verizon Communications | CBRE vs. Take Two Interactive Software |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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