Correlation Between Stockland and Gaming
Can any of the company-specific risk be diversified away by investing in both Stockland and 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 Stockland and Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stockland and Gaming and Leisure, you can compare the effects of market volatilities on Stockland and 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 Stockland with a short position of Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stockland and Gaming.
Diversification Opportunities for Stockland and Gaming
Very weak diversification
The 3 months correlation between Stockland and Gaming is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Stockland and Gaming and Leisure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaming and Leisure and Stockland 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 Stockland are associated (or correlated) with Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaming and Leisure has no effect on the direction of Stockland i.e., Stockland and Gaming go up and down completely randomly.
Pair Corralation between Stockland and Gaming
Assuming the 90 days horizon Stockland is expected to generate 2.06 times less return on investment than Gaming. In addition to that, Stockland is 1.03 times more volatile than Gaming and Leisure. It trades about 0.02 of its total potential returns per unit of risk. Gaming and Leisure is currently generating about 0.05 per unit of volatility. If you would invest 4,514 in Gaming and Leisure on December 28, 2024 and sell it today you would earn a total of 166.00 from holding Gaming and Leisure or generate 3.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Stockland vs. Gaming and Leisure
Performance |
Timeline |
Stockland |
Gaming and Leisure |
Stockland and Gaming Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Stockland and Gaming
The main advantage of trading using opposite Stockland and Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stockland position performs unexpectedly, 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 Gaming will offset losses from the drop in Gaming's long position.Stockland vs. GOLDQUEST MINING | Stockland vs. Calibre Mining Corp | Stockland vs. East Africa Metals | Stockland vs. Western Copper and |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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