Correlation Between TEN SQUARE and Live Motion

Can any of the company-specific risk be diversified away by investing in both TEN SQUARE and Live Motion 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 TEN SQUARE and Live Motion into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TEN SQUARE GAMES and Live Motion Games, you can compare the effects of market volatilities on TEN SQUARE and Live Motion 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 TEN SQUARE with a short position of Live Motion. Check out your portfolio center. Please also check ongoing floating volatility patterns of TEN SQUARE and Live Motion.

Diversification Opportunities for TEN SQUARE and Live Motion

0.4

Correlation Coefficient

TEN SQUARE  Live Motion

Very weak diversification

The 3 months correlation between TEN and Live is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding TEN SQUARE GAMES and Live Motion Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Motion Games and TEN SQUARE 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 TEN SQUARE GAMES are associated (or correlated) with Live Motion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Motion Games has no effect on the direction of TEN SQUARE i.e., TEN SQUARE and Live Motion go up and down completely randomly.

Pair Corralation between TEN SQUARE and Live Motion

Assuming the 90 days trading horizon TEN SQUARE GAMES is expected to generate 0.43 times more return on investment than Live Motion. However, TEN SQUARE GAMES is 2.33 times less risky than Live Motion. It trades about -0.02 of its potential returns per unit of risk. Live Motion Games is currently generating about -0.05 per unit of risk. If you would invest  11,850  in TEN SQUARE GAMES on December 2, 2024 and sell it today you would lose (3,920) from holding TEN SQUARE GAMES or give up 33.08% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.17%
Values	Daily Returns

TEN SQUARE GAMES  vs.  Live Motion Games

TEN SQUARE GAMES

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TEN SQUARE GAMES are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, TEN SQUARE is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Live Motion Games

Risk-Adjusted Performance

Very Weak

Over the last 90 days Live Motion Games has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Live Motion is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with TEN SQUARE and Live Motion

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

The idea behind TEN SQUARE GAMES and Live Motion 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.