Correlation Between ALLSTATE and Champion Gaming

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

By analyzing existing cross correlation between ALLSTATE P 535 and Champion Gaming Group, you can compare the effects of market volatilities on ALLSTATE and Champion 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 ALLSTATE with a short position of Champion Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALLSTATE and Champion Gaming.

Diversification Opportunities for ALLSTATE and Champion Gaming

0.0

Correlation Coefficient

ALLSTATE  Champion Gaming

Pay attention - limited upside

The 3 months correlation between ALLSTATE and Champion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALLSTATE P 535 and Champion Gaming Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Champion Gaming Group and ALLSTATE 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 ALLSTATE P 535 are associated (or correlated) with Champion Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Champion Gaming Group has no effect on the direction of ALLSTATE i.e., ALLSTATE and Champion Gaming go up and down completely randomly.

Pair Corralation between ALLSTATE and Champion Gaming

If you would invest  10,272  in ALLSTATE P 535 on October 9, 2024 and sell it today you would lose (6.00) from holding ALLSTATE P 535 or give up 0.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	80.65%
Values	Daily Returns

ALLSTATE P 535  vs.  Champion Gaming Group

ALLSTATE P 535

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ALLSTATE P 535 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ALLSTATE is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Champion Gaming Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Champion Gaming Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Champion Gaming is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ALLSTATE and Champion Gaming

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

The idea behind ALLSTATE P 535 and Champion Gaming Group 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..