Correlation Between Gambling and Codere Online

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

By analyzing existing cross correlation between Gambling Group and Codere Online Luxembourg, you can compare the effects of market volatilities on Gambling and Codere Online 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 Gambling with a short position of Codere Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gambling and Codere Online.

Diversification Opportunities for Gambling and Codere Online

-0.03

Correlation Coefficient

Gambling  Codere Online

Good diversification

The 3 months correlation between Gambling and Codere is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Gambling Group and Codere Online Luxembourg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codere Online Luxembourg and Gambling 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 Gambling Group are associated (or correlated) with Codere Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codere Online Luxembourg has no effect on the direction of Gambling i.e., Gambling and Codere Online go up and down completely randomly.

Pair Corralation between Gambling and Codere Online

Given the investment horizon of 90 days Gambling Group is expected to under-perform the Codere Online. But the stock apears to be less risky and, when comparing its historical volatility, Gambling Group is 2.27 times less risky than Codere Online. The stock trades about -0.05 of its potential returns per unit of risk. The Codere Online Luxembourg is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  60.00  in Codere Online Luxembourg on December 29, 2024 and sell it today you would earn a total of  9.00  from holding Codere Online Luxembourg or generate 15.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.16%
Values	Daily Returns

Gambling Group  vs.  Codere Online Luxembourg

Gambling Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gambling Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Codere Online Luxembourg

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Codere Online Luxembourg are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Codere Online showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gambling and Codere Online

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

The idea behind Gambling Group and Codere Online Luxembourg 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.