Correlation Between XAAR PLC and Corsair Gaming
Can any of the company-specific risk be diversified away by investing in both XAAR PLC and Corsair Gaming 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 XAAR PLC and Corsair Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XAAR PLC LS 10 and Corsair Gaming, you can compare the effects of market volatilities on XAAR PLC and Corsair Gaming 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 XAAR PLC with a short position of Corsair Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of XAAR PLC and Corsair Gaming.
Diversification Opportunities for XAAR PLC and Corsair Gaming
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between XAAR and Corsair is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding XAAR PLC LS 10 and Corsair Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corsair Gaming and XAAR PLC 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 XAAR PLC LS 10 are associated (or correlated) with Corsair Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corsair Gaming has no effect on the direction of XAAR PLC i.e., XAAR PLC and Corsair Gaming go up and down completely randomly.
Pair Corralation between XAAR PLC and Corsair Gaming
Assuming the 90 days horizon XAAR PLC LS 10 is expected to generate 1.12 times more return on investment than Corsair Gaming. However, XAAR PLC is 1.12 times more volatile than Corsair Gaming. It trades about -0.02 of its potential returns per unit of risk. Corsair Gaming is currently generating about -0.03 per unit of risk. If you would invest 182.00 in XAAR PLC LS 10 on October 19, 2024 and sell it today you would lose (91.00) from holding XAAR PLC LS 10 or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XAAR PLC LS 10 vs. Corsair Gaming
Performance |
| Timeline |
| XAAR PLC LS |
| Corsair Gaming |
XAAR PLC and Corsair Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XAAR PLC and Corsair Gaming
The main advantage of trading using opposite XAAR PLC and Corsair Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XAAR PLC position performs unexpectedly, Corsair Gaming 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 Corsair Gaming will offset losses from the drop in Corsair Gaming's long position.| XAAR PLC vs. China Resources Beer | XAAR PLC vs. Monster Beverage Corp | XAAR PLC vs. Yuexiu Transport Infrastructure | XAAR PLC vs. THAI BEVERAGE |
| Corsair Gaming vs. Sumitomo Mitsui Construction | Corsair Gaming vs. Aluminum of | Corsair Gaming vs. ADRIATIC METALS LS 013355 | Corsair Gaming vs. Hanison Construction Holdings |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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