Correlation Between GAMESTOP and QIIWI GAMES

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

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

Diversification Opportunities for GAMESTOP and QIIWI GAMES

0.13

Correlation Coefficient

GAMESTOP  QIIWI GAMES

Average diversification

The 3 months correlation between GAMESTOP and QIIWI is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding GAMESTOP and QIIWI GAMES AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QIIWI GAMES AB and GAMESTOP 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 GAMESTOP are associated (or correlated) with QIIWI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QIIWI GAMES AB has no effect on the direction of GAMESTOP i.e., GAMESTOP and QIIWI GAMES go up and down completely randomly.

Pair Corralation between GAMESTOP and QIIWI GAMES

Assuming the 90 days trading horizon GAMESTOP is expected to under-perform the QIIWI GAMES. But the stock apears to be less risky and, when comparing its historical volatility, GAMESTOP is 1.44 times less risky than QIIWI GAMES. The stock trades about -0.05 of its potential returns per unit of risk. The QIIWI GAMES AB is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  31.00  in QIIWI GAMES AB on November 29, 2024 and sell it today you would lose (3.00) from holding QIIWI GAMES AB or give up 9.68% of portfolio value over 90 days.

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

GAMESTOP  vs.  QIIWI GAMES AB

GAMESTOP

Risk-Adjusted Performance

Very Weak

Over the last 90 days GAMESTOP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

QIIWI GAMES AB

Risk-Adjusted Performance

Very Weak

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

Pair Trading with GAMESTOP and QIIWI GAMES

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

The idea behind GAMESTOP and QIIWI GAMES AB 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.