Correlation Between True Games and Carlson Investments
Can any of the company-specific risk be diversified away by investing in both True Games and Carlson Investments 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 True Games and Carlson Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between True Games Syndicate and Carlson Investments SA, you can compare the effects of market volatilities on True Games and Carlson Investments 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 True Games with a short position of Carlson Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of True Games and Carlson Investments.
Diversification Opportunities for True Games and Carlson Investments
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between True and Carlson is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding True Games Syndicate and Carlson Investments SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlson Investments and True Games 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 True Games Syndicate are associated (or correlated) with Carlson Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlson Investments has no effect on the direction of True Games i.e., True Games and Carlson Investments go up and down completely randomly.
Pair Corralation between True Games and Carlson Investments
Assuming the 90 days trading horizon True Games Syndicate is expected to under-perform the Carlson Investments. But the stock apears to be less risky and, when comparing its historical volatility, True Games Syndicate is 1.63 times less risky than Carlson Investments. The stock trades about -0.1 of its potential returns per unit of risk. The Carlson Investments SA is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 384.00 in Carlson Investments SA on September 1, 2024 and sell it today you would earn a total of 63.00 from holding Carlson Investments SA or generate 16.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.0% |
| Values | Daily Returns |
True Games Syndicate vs. Carlson Investments SA
Performance |
| Timeline |
| True Games Syndicate |
| Carlson Investments |
True Games and Carlson Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with True Games and Carlson Investments
The main advantage of trading using opposite True Games and Carlson Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if True Games position performs unexpectedly, Carlson Investments 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 Carlson Investments will offset losses from the drop in Carlson Investments' long position.| True Games vs. mBank SA | True Games vs. BNP Paribas Bank | True Games vs. Gamedust SA | True Games vs. GreenX Metals |
| Carlson Investments vs. Asseco Business Solutions | Carlson Investments vs. Detalion Games SA | Carlson Investments vs. Asseco South Eastern | Carlson Investments vs. CFI Holding SA |
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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