Correlation Between DETALION GAMES and Canadian Utilities

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

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

Diversification Opportunities for DETALION GAMES and Canadian Utilities

-0.39

Correlation Coefficient

DETALION GAMES  Canadian Utilities

Very good diversification

The 3 months correlation between DETALION and Canadian is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding DETALION GAMES SA and Canadian Utilities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities and DETALION GAMES 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 DETALION GAMES SA are associated (or correlated) with Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of DETALION GAMES i.e., DETALION GAMES and Canadian Utilities go up and down completely randomly.

Pair Corralation between DETALION GAMES and Canadian Utilities

Assuming the 90 days horizon DETALION GAMES SA is expected to generate 6.06 times more return on investment than Canadian Utilities. However, DETALION GAMES is 6.06 times more volatile than Canadian Utilities Limited. It trades about 0.27 of its potential returns per unit of risk. Canadian Utilities Limited is currently generating about -0.07 per unit of risk. If you would invest  18.00  in DETALION GAMES SA on October 26, 2024 and sell it today you would earn a total of  4.00  from holding DETALION GAMES SA or generate 22.22% return on investment over 90 days.

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

DETALION GAMES SA  vs.  Canadian Utilities Limited

DETALION GAMES SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DETALION GAMES SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, DETALION GAMES is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Canadian Utilities

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Canadian Utilities Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Canadian Utilities is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with DETALION GAMES and Canadian Utilities

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

The idea behind DETALION GAMES SA and Canadian Utilities Limited 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.