Correlation Between Tower Investments and CI Games
Can any of the company-specific risk be diversified away by investing in both Tower Investments and CI Games 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 Tower Investments and CI Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tower Investments SA and CI Games SA, you can compare the effects of market volatilities on Tower Investments and CI Games 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 Tower Investments with a short position of CI Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tower Investments and CI Games.
Diversification Opportunities for Tower Investments and CI Games
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tower and CIG is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Tower Investments SA and CI Games SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Games SA and Tower Investments 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 Tower Investments SA are associated (or correlated) with CI Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Games SA has no effect on the direction of Tower Investments i.e., Tower Investments and CI Games go up and down completely randomly.
Pair Corralation between Tower Investments and CI Games
Assuming the 90 days trading horizon Tower Investments SA is expected to generate 3.3 times more return on investment than CI Games. However, Tower Investments is 3.3 times more volatile than CI Games SA. It trades about -0.04 of its potential returns per unit of risk. CI Games SA is currently generating about -0.3 per unit of risk. If you would invest 278.00 in Tower Investments SA on September 1, 2024 and sell it today you would lose (12.00) from holding Tower Investments SA or give up 4.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tower Investments SA vs. CI Games SA
Performance |
| Timeline |
| Tower Investments |
| CI Games SA |
Tower Investments and CI Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tower Investments and CI Games
The main advantage of trading using opposite Tower Investments and CI Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tower Investments position performs unexpectedly, CI Games 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 CI Games will offset losses from the drop in CI Games' long position.| Tower Investments vs. Asseco Business Solutions | Tower Investments vs. Detalion Games SA | Tower Investments vs. Asseco South Eastern | Tower Investments vs. CFI Holding SA |
| CI Games vs. Enter Air SA | CI Games vs. BNP Paribas Bank | CI Games vs. Globe Trade Centre | CI Games vs. MCI Management 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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