Correlation Between Pepco Group and All In

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

By analyzing existing cross correlation between Pepco Group BV and All In Games, you can compare the effects of market volatilities on Pepco Group and All In 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 Pepco Group with a short position of All In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pepco Group and All In.

Diversification Opportunities for Pepco Group and All In

-0.33

Correlation Coefficient

Pepco Group  All In

Very good diversification

The 3 months correlation between Pepco and All is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pepco Group BV and All In Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on All In Games and Pepco Group 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 Pepco Group BV are associated (or correlated) with All In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of All In Games has no effect on the direction of Pepco Group i.e., Pepco Group and All In go up and down completely randomly.

Pair Corralation between Pepco Group and All In

Assuming the 90 days trading horizon Pepco Group BV is expected to generate 0.93 times more return on investment than All In. However, Pepco Group BV is 1.07 times less risky than All In. It trades about 0.07 of its potential returns per unit of risk. All In Games is currently generating about -0.05 per unit of risk. If you would invest  1,590  in Pepco Group BV on November 29, 2024 and sell it today you would earn a total of  142.00  from holding Pepco Group BV or generate 8.93% return on investment over 90 days.

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

Pepco Group BV  vs.  All In Games

Pepco Group BV

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Pepco Group BV are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Pepco Group may actually be approaching a critical reversion point that can send shares even higher in March 2025.

All In Games

Risk-Adjusted Performance

Very Weak

Over the last 90 days All In Games has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Pepco Group and All In

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

The idea behind Pepco Group BV and All In Games 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.