Correlation Between Gaming and Impala Platinum
Can any of the company-specific risk be diversified away by investing in both Gaming and Impala Platinum 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 Gaming and Impala Platinum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaming and Leisure and Impala Platinum Holdings, you can compare the effects of market volatilities on Gaming and Impala Platinum 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 Gaming with a short position of Impala Platinum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaming and Impala Platinum.
Diversification Opportunities for Gaming and Impala Platinum
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Gaming and Impala is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Gaming and Leisure and Impala Platinum Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impala Platinum Holdings and 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 Gaming and Leisure are associated (or correlated) with Impala Platinum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impala Platinum Holdings has no effect on the direction of Gaming i.e., Gaming and Impala Platinum go up and down completely randomly.
Pair Corralation between Gaming and Impala Platinum
Assuming the 90 days horizon Gaming is expected to generate 2.42 times less return on investment than Impala Platinum. But when comparing it to its historical volatility, Gaming and Leisure is 3.72 times less risky than Impala Platinum. It trades about 0.06 of its potential returns per unit of risk. Impala Platinum Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 396.00 in Impala Platinum Holdings on October 8, 2024 and sell it today you would earn a total of 85.00 from holding Impala Platinum Holdings or generate 21.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Gaming and Leisure vs. Impala Platinum Holdings
Performance |
Timeline |
Gaming and Leisure |
Impala Platinum Holdings |
Gaming and Impala Platinum Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gaming and Impala Platinum
The main advantage of trading using opposite Gaming and Impala Platinum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaming position performs unexpectedly, Impala Platinum 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 Impala Platinum will offset losses from the drop in Impala Platinum's long position.Gaming vs. Performance Food Group | Gaming vs. Lifeway Foods | Gaming vs. Ebro Foods SA | Gaming vs. MTY Food Group |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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