Correlation Between Triad Group and Games Workshop
Can any of the company-specific risk be diversified away by investing in both Triad Group 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 Triad Group and Games Workshop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triad Group PLC and Games Workshop Group, you can compare the effects of market volatilities on Triad Group 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 Triad Group with a short position of Games Workshop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triad Group and Games Workshop.
Diversification Opportunities for Triad Group and Games Workshop
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Triad and Games is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Triad Group PLC 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 Triad Group 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 Triad Group PLC 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 Triad Group i.e., Triad Group and Games Workshop go up and down completely randomly.
Pair Corralation between Triad Group and Games Workshop
Assuming the 90 days trading horizon Triad Group PLC is expected to generate 1.26 times more return on investment than Games Workshop. However, Triad Group is 1.26 times more volatile than Games Workshop Group. It trades about 0.11 of its potential returns per unit of risk. Games Workshop Group is currently generating about 0.06 per unit of risk. If you would invest 13,652 in Triad Group PLC on November 28, 2024 and sell it today you would earn a total of 25,848 from holding Triad Group PLC or generate 189.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Triad Group PLC vs. Games Workshop Group
Performance |
| Timeline |
| Triad Group PLC |
| Games Workshop Group |
Triad Group and Games Workshop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triad Group and Games Workshop
The main advantage of trading using opposite Triad Group and Games Workshop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triad Group 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.| Triad Group vs. Bytes Technology | Triad Group vs. Air Products Chemicals | Triad Group vs. Zoom Video Communications | Triad Group vs. Albion Technology General |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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