Correlation Between SUPER GROUP and GungHo Online
Can any of the company-specific risk be diversified away by investing in both SUPER GROUP and GungHo Online 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 SUPER GROUP and GungHo Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SUPER GROUP LTD and GungHo Online Entertainment, you can compare the effects of market volatilities on SUPER GROUP and GungHo Online 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 SUPER GROUP with a short position of GungHo Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUPER GROUP and GungHo Online.
Diversification Opportunities for SUPER GROUP and GungHo Online
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between SUPER and GungHo is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding SUPER GROUP LTD and GungHo Online Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GungHo Online Entert and SUPER 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 SUPER GROUP LTD are associated (or correlated) with GungHo Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GungHo Online Entert has no effect on the direction of SUPER GROUP i.e., SUPER GROUP and GungHo Online go up and down completely randomly.
Pair Corralation between SUPER GROUP and GungHo Online
Assuming the 90 days trading horizon SUPER GROUP LTD is expected to generate 3.06 times more return on investment than GungHo Online. However, SUPER GROUP is 3.06 times more volatile than GungHo Online Entertainment. It trades about 0.06 of its potential returns per unit of risk. GungHo Online Entertainment is currently generating about 0.02 per unit of risk. If you would invest 47.00 in SUPER GROUP LTD on October 5, 2024 and sell it today you would earn a total of 102.00 from holding SUPER GROUP LTD or generate 217.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SUPER GROUP LTD vs. GungHo Online Entertainment
Performance |
| Timeline |
| SUPER GROUP LTD |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| GungHo Online Entert |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
SUPER GROUP and GungHo Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SUPER GROUP and GungHo Online
The main advantage of trading using opposite SUPER GROUP and GungHo Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUPER GROUP position performs unexpectedly, GungHo Online 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 GungHo Online will offset losses from the drop in GungHo Online's long position.The idea behind SUPER GROUP LTD and GungHo Online Entertainment 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.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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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