Correlation Between Contagious Gaming and Emerson Electric
Can any of the company-specific risk be diversified away by investing in both Contagious Gaming and Emerson Electric 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 Contagious Gaming and Emerson Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Contagious Gaming and Emerson Electric, you can compare the effects of market volatilities on Contagious Gaming and Emerson Electric 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 Contagious Gaming with a short position of Emerson Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contagious Gaming and Emerson Electric.
Diversification Opportunities for Contagious Gaming and Emerson Electric
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Contagious and Emerson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Contagious Gaming and Emerson Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerson Electric and Contagious Gaming 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 Contagious Gaming are associated (or correlated) with Emerson Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerson Electric has no effect on the direction of Contagious Gaming i.e., Contagious Gaming and Emerson Electric go up and down completely randomly.
Pair Corralation between Contagious Gaming and Emerson Electric
Assuming the 90 days horizon Contagious Gaming is expected to generate 2.7 times less return on investment than Emerson Electric. In addition to that, Contagious Gaming is 4.63 times more volatile than Emerson Electric. It trades about 0.0 of its total potential returns per unit of risk. Emerson Electric is currently generating about 0.05 per unit of volatility. If you would invest 9,212 in Emerson Electric on September 23, 2024 and sell it today you would earn a total of 3,197 from holding Emerson Electric or generate 34.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
Contagious Gaming vs. Emerson Electric
Performance |
Timeline |
Contagious Gaming |
Emerson Electric |
Contagious Gaming and Emerson Electric Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Contagious Gaming and Emerson Electric
The main advantage of trading using opposite Contagious Gaming and Emerson Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contagious Gaming position performs unexpectedly, Emerson Electric 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 Emerson Electric will offset losses from the drop in Emerson Electric's long position.Contagious Gaming vs. ATA Creativity Global | Contagious Gaming vs. American Public Education | Contagious Gaming vs. Skillful Craftsman Education | Contagious Gaming vs. China Liberal Education |
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Check out your portfolio center.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.
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