Correlation Between Ikigai Ventures and G5 Entertainment

Can any of the company-specific risk be diversified away by investing in both Ikigai Ventures and G5 Entertainment 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 Ikigai Ventures and G5 Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ikigai Ventures and G5 Entertainment AB, you can compare the effects of market volatilities on Ikigai Ventures and G5 Entertainment 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 Ikigai Ventures with a short position of G5 Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ikigai Ventures and G5 Entertainment.

Diversification Opportunities for Ikigai Ventures and G5 Entertainment

-0.08

Correlation Coefficient

Ikigai Ventures  G5 Entertainment

Good diversification

The 3 months correlation between Ikigai and 0QUS is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ikigai Ventures and G5 Entertainment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G5 Entertainment and Ikigai Ventures 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 Ikigai Ventures are associated (or correlated) with G5 Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G5 Entertainment has no effect on the direction of Ikigai Ventures i.e., Ikigai Ventures and G5 Entertainment go up and down completely randomly.

Pair Corralation between Ikigai Ventures and G5 Entertainment

Assuming the 90 days trading horizon Ikigai Ventures is expected to under-perform the G5 Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Ikigai Ventures is 3.06 times less risky than G5 Entertainment. The stock trades about -0.23 of its potential returns per unit of risk. The G5 Entertainment AB is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  10,700  in G5 Entertainment AB on October 24, 2024 and sell it today you would earn a total of  1,100  from holding G5 Entertainment AB or generate 10.28% return on investment over 90 days.

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

Ikigai Ventures  vs.  G5 Entertainment AB

Ikigai Ventures

Risk-Adjusted Performance

0 of 100

Very Weak

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

G5 Entertainment

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in G5 Entertainment AB are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, G5 Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ikigai Ventures and G5 Entertainment

The main advantage of trading using opposite Ikigai Ventures and G5 Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ikigai Ventures position performs unexpectedly, G5 Entertainment 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 G5 Entertainment will offset losses from the drop in G5 Entertainment's long position.

The idea behind Ikigai Ventures and G5 Entertainment 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.