Correlation Between 251566AA3 and Neogames

Can any of the company-specific risk be diversified away by investing in both 251566AA3 and Neogames 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 251566AA3 and Neogames into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DT 3625 21 JAN 50 and Neogames SA, you can compare the effects of market volatilities on 251566AA3 and Neogames 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 251566AA3 with a short position of Neogames. Check out your portfolio center. Please also check ongoing floating volatility patterns of 251566AA3 and Neogames.

Diversification Opportunities for 251566AA3 and Neogames

-0.51

Correlation Coefficient

251566AA3  Neogames

Excellent diversification

The 3 months correlation between 251566AA3 and Neogames is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding DT 3625 21 JAN 50 and Neogames SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neogames SA and 251566AA3 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 DT 3625 21 JAN 50 are associated (or correlated) with Neogames. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neogames SA has no effect on the direction of 251566AA3 i.e., 251566AA3 and Neogames go up and down completely randomly.

Pair Corralation between 251566AA3 and Neogames

Assuming the 90 days trading horizon DT 3625 21 JAN 50 is expected to under-perform the Neogames. But the bond apears to be less risky and, when comparing its historical volatility, DT 3625 21 JAN 50 is 5.09 times less risky than Neogames. The bond trades about 0.0 of its potential returns per unit of risk. The Neogames SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  1,229  in Neogames SA on October 3, 2024 and sell it today you would earn a total of  1,480  from holding Neogames SA or generate 120.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	61.86%
Values	Daily Returns

DT 3625 21 JAN 50  vs.  Neogames SA

DT 3625 21

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DT 3625 21 JAN 50 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 251566AA3 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Neogames SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Neogames SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable primary indicators, Neogames is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with 251566AA3 and Neogames

The main advantage of trading using opposite 251566AA3 and Neogames positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 251566AA3 position performs unexpectedly, Neogames 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 Neogames will offset losses from the drop in Neogames' long position.

The idea behind DT 3625 21 JAN 50 and Neogames SA 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..