Correlation Between Creativeforge Games and Lubelski Wegiel

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

By analyzing existing cross correlation between Creativeforge Games SA and Lubelski Wegiel Bogdanka, you can compare the effects of market volatilities on Creativeforge Games and Lubelski Wegiel 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 Creativeforge Games with a short position of Lubelski Wegiel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creativeforge Games and Lubelski Wegiel.

Diversification Opportunities for Creativeforge Games and Lubelski Wegiel

0.43

Correlation Coefficient

Creativeforge Games  Lubelski Wegiel

Very weak diversification

The 3 months correlation between Creativeforge and Lubelski is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Creativeforge Games SA and Lubelski Wegiel Bogdanka in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lubelski Wegiel Bogdanka and Creativeforge 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 Creativeforge Games SA are associated (or correlated) with Lubelski Wegiel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lubelski Wegiel Bogdanka has no effect on the direction of Creativeforge Games i.e., Creativeforge Games and Lubelski Wegiel go up and down completely randomly.

Pair Corralation between Creativeforge Games and Lubelski Wegiel

Assuming the 90 days trading horizon Creativeforge Games SA is expected to under-perform the Lubelski Wegiel. In addition to that, Creativeforge Games is 2.48 times more volatile than Lubelski Wegiel Bogdanka. It trades about -0.06 of its total potential returns per unit of risk. Lubelski Wegiel Bogdanka is currently generating about -0.05 per unit of volatility. If you would invest  2,334  in Lubelski Wegiel Bogdanka on October 10, 2024 and sell it today you would lose (164.00) from holding Lubelski Wegiel Bogdanka or give up 7.03% of portfolio value over 90 days.

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

Creativeforge Games SA  vs.  Lubelski Wegiel Bogdanka

Creativeforge Games

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Creativeforge Games SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Lubelski Wegiel Bogdanka

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lubelski Wegiel Bogdanka has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Creativeforge Games and Lubelski Wegiel

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

The idea behind Creativeforge Games SA and Lubelski Wegiel Bogdanka 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.