Correlation Between GAMES OPERATORS and ITV -

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

By analyzing existing cross correlation between GAMES OPERATORS SA and ITV Dusseldorf, you can compare the effects of market volatilities on GAMES OPERATORS and ITV - 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 GAMES OPERATORS with a short position of ITV -. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMES OPERATORS and ITV -.

Diversification Opportunities for GAMES OPERATORS and ITV -

0.02

Correlation Coefficient

GAMES OPERATORS  ITV -

Significant diversification

The 3 months correlation between GAMES and ITV is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding GAMES OPERATORS SA and ITV Dusseldorf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITV Dusseldorf and GAMES OPERATORS 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 GAMES OPERATORS SA are associated (or correlated) with ITV -. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITV Dusseldorf has no effect on the direction of GAMES OPERATORS i.e., GAMES OPERATORS and ITV - go up and down completely randomly.

Pair Corralation between GAMES OPERATORS and ITV -

Assuming the 90 days horizon GAMES OPERATORS SA is expected to under-perform the ITV -. In addition to that, GAMES OPERATORS is 1.45 times more volatile than ITV Dusseldorf. It trades about -0.15 of its total potential returns per unit of risk. ITV Dusseldorf is currently generating about -0.17 per unit of volatility. If you would invest  90.00  in ITV Dusseldorf on October 9, 2024 and sell it today you would lose (4.00) from holding ITV Dusseldorf or give up 4.44% of portfolio value over 90 days.

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

GAMES OPERATORS SA  vs.  ITV Dusseldorf

GAMES OPERATORS SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

ITV Dusseldorf

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ITV Dusseldorf has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, ITV - is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with GAMES OPERATORS and ITV -

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

The idea behind GAMES OPERATORS SA and ITV Dusseldorf 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.