Correlation Between FRACTAL GAMING and Cars

Can any of the company-specific risk be diversified away by investing in both FRACTAL GAMING and Cars 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 FRACTAL GAMING and Cars into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FRACTAL GAMING GROUP and Cars Inc, you can compare the effects of market volatilities on FRACTAL GAMING and Cars 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 FRACTAL GAMING with a short position of Cars. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRACTAL GAMING and Cars.

Diversification Opportunities for FRACTAL GAMING and Cars

-0.63

Correlation Coefficient

FRACTAL GAMING  Cars

Excellent diversification

The 3 months correlation between FRACTAL and Cars is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding FRACTAL GAMING GROUP and Cars Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cars Inc and FRACTAL 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 FRACTAL GAMING GROUP are associated (or correlated) with Cars. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cars Inc has no effect on the direction of FRACTAL GAMING i.e., FRACTAL GAMING and Cars go up and down completely randomly.

Pair Corralation between FRACTAL GAMING and Cars

Assuming the 90 days horizon FRACTAL GAMING GROUP is expected to generate 0.59 times more return on investment than Cars. However, FRACTAL GAMING GROUP is 1.69 times less risky than Cars. It trades about 0.16 of its potential returns per unit of risk. Cars Inc is currently generating about -0.13 per unit of risk. If you would invest  276.00  in FRACTAL GAMING GROUP on December 29, 2024 and sell it today you would earn a total of  70.00  from holding FRACTAL GAMING GROUP or generate 25.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

FRACTAL GAMING GROUP  vs.  Cars Inc

FRACTAL GAMING GROUP

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FRACTAL GAMING GROUP are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, FRACTAL GAMING reported solid returns over the last few months and may actually be approaching a breakup point.

Cars Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cars Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with FRACTAL GAMING and Cars

The main advantage of trading using opposite FRACTAL GAMING and Cars positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FRACTAL GAMING position performs unexpectedly, Cars 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 Cars will offset losses from the drop in Cars' long position.

The idea behind FRACTAL GAMING GROUP and Cars Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.