Correlation Between FRACTAL GAMING and TIMES CHINA

Can any of the company-specific risk be diversified away by investing in both FRACTAL GAMING and TIMES CHINA 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 TIMES CHINA 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 TIMES CHINA HLDGS, you can compare the effects of market volatilities on FRACTAL GAMING and TIMES CHINA 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 TIMES CHINA. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRACTAL GAMING and TIMES CHINA.

Diversification Opportunities for FRACTAL GAMING and TIMES CHINA

0.21

Correlation Coefficient

FRACTAL GAMING  TIMES CHINA

Modest diversification

The 3 months correlation between FRACTAL and TIMES is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding FRACTAL GAMING GROUP and TIMES CHINA HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TIMES CHINA HLDGS 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 TIMES CHINA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TIMES CHINA HLDGS has no effect on the direction of FRACTAL GAMING i.e., FRACTAL GAMING and TIMES CHINA go up and down completely randomly.

Pair Corralation between FRACTAL GAMING and TIMES CHINA

Assuming the 90 days horizon FRACTAL GAMING is expected to generate 6.98 times less return on investment than TIMES CHINA. But when comparing it to its historical volatility, FRACTAL GAMING GROUP is 5.18 times less risky than TIMES CHINA. It trades about 0.03 of its potential returns per unit of risk. TIMES CHINA HLDGS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  15.00  in TIMES CHINA HLDGS on October 21, 2024 and sell it today you would lose (12.05) from holding TIMES CHINA HLDGS or give up 80.33% of portfolio value over 90 days.

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

FRACTAL GAMING GROUP  vs.  TIMES CHINA HLDGS

FRACTAL GAMING GROUP

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FRACTAL GAMING GROUP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, FRACTAL GAMING is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

TIMES CHINA HLDGS

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TIMES CHINA HLDGS are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, TIMES CHINA may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with FRACTAL GAMING and TIMES CHINA

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

The idea behind FRACTAL GAMING GROUP and TIMES CHINA HLDGS 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.