Correlation Between CHINA TONTINE and FRACTAL GAMING

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

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

Diversification Opportunities for CHINA TONTINE and FRACTAL GAMING

0.0

Correlation Coefficient

CHINA TONTINE  FRACTAL GAMING

Pay attention - limited upside

The 3 months correlation between CHINA and FRACTAL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHINA TONTINE WINES and FRACTAL GAMING GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRACTAL GAMING GROUP and CHINA TONTINE 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 CHINA TONTINE WINES are associated (or correlated) with FRACTAL GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRACTAL GAMING GROUP has no effect on the direction of CHINA TONTINE i.e., CHINA TONTINE and FRACTAL GAMING go up and down completely randomly.

Pair Corralation between CHINA TONTINE and FRACTAL GAMING

If you would invest  270.00  in FRACTAL GAMING GROUP on October 10, 2024 and sell it today you would earn a total of  30.00  from holding FRACTAL GAMING GROUP or generate 11.11% return on investment over 90 days.

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

CHINA TONTINE WINES  vs.  FRACTAL GAMING GROUP

CHINA TONTINE WINES

Risk-Adjusted Performance

0 of 100

Very Weak

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

FRACTAL GAMING GROUP

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in FRACTAL GAMING GROUP are ranked lower than 3 (%) 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 current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CHINA TONTINE and FRACTAL GAMING

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

The idea behind CHINA TONTINE WINES and FRACTAL GAMING GROUP 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.