Correlation Between Champion Gaming and Fairfax Financial
Can any of the company-specific risk be diversified away by investing in both Champion Gaming and Fairfax Financial 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 Champion Gaming and Fairfax Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champion Gaming Group and Fairfax Financial Holdings, you can compare the effects of market volatilities on Champion Gaming and Fairfax Financial 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 Champion Gaming with a short position of Fairfax Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Gaming and Fairfax Financial.
Diversification Opportunities for Champion Gaming and Fairfax Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Champion and Fairfax is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Champion Gaming Group and Fairfax Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fairfax Financial and Champion Gaming 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 Champion Gaming Group are associated (or correlated) with Fairfax Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fairfax Financial has no effect on the direction of Champion Gaming i.e., Champion Gaming and Fairfax Financial go up and down completely randomly.
Pair Corralation between Champion Gaming and Fairfax Financial
Assuming the 90 days trading horizon Champion Gaming is expected to generate 2.01 times less return on investment than Fairfax Financial. In addition to that, Champion Gaming is 10.8 times more volatile than Fairfax Financial Holdings. It trades about 0.01 of its total potential returns per unit of risk. Fairfax Financial Holdings is currently generating about 0.11 per unit of volatility. If you would invest 1,432 in Fairfax Financial Holdings on September 14, 2024 and sell it today you would earn a total of 868.00 from holding Fairfax Financial Holdings or generate 60.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Champion Gaming Group vs. Fairfax Financial Holdings
Performance |
| Timeline |
| Champion Gaming Group |
| Fairfax Financial |
Champion Gaming and Fairfax Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champion Gaming and Fairfax Financial
The main advantage of trading using opposite Champion Gaming and Fairfax Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champion Gaming position performs unexpectedly, Fairfax Financial 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 Fairfax Financial will offset losses from the drop in Fairfax Financial's long position.| Champion Gaming vs. Slate Grocery REIT | Champion Gaming vs. Roots Corp | Champion Gaming vs. Aimia Inc | Champion Gaming vs. Morguard Real Estate |
| Fairfax Financial vs. Quorum Information Technologies | Fairfax Financial vs. Champion Gaming Group | Fairfax Financial vs. Nicola Mining | Fairfax Financial vs. Major Drilling Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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