Correlation Between SAMMON and Galaxy Gaming

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

By analyzing existing cross correlation between SAMMON 475 08 APR 32 and Galaxy Gaming, you can compare the effects of market volatilities on SAMMON and Galaxy 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 SAMMON with a short position of Galaxy Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAMMON and Galaxy Gaming.

Diversification Opportunities for SAMMON and Galaxy Gaming

0.04

Correlation Coefficient

SAMMON  Galaxy Gaming

Significant diversification

The 3 months correlation between SAMMON and Galaxy is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding SAMMON 475 08 APR 32 and Galaxy Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Gaming and SAMMON 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 SAMMON 475 08 APR 32 are associated (or correlated) with Galaxy Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galaxy Gaming has no effect on the direction of SAMMON i.e., SAMMON and Galaxy Gaming go up and down completely randomly.

Pair Corralation between SAMMON and Galaxy Gaming

Assuming the 90 days trading horizon SAMMON 475 08 APR 32 is expected to under-perform the Galaxy Gaming. In addition to that, SAMMON is 6.86 times more volatile than Galaxy Gaming. It trades about -0.1 of its total potential returns per unit of risk. Galaxy Gaming is currently generating about -0.07 per unit of volatility. If you would invest  275.00  in Galaxy Gaming on October 7, 2024 and sell it today you would lose (4.00) from holding Galaxy Gaming or give up 1.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	40.0%
Values	Daily Returns

SAMMON 475 08 APR 32  vs.  Galaxy Gaming

SAMMON 475 08

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SAMMON 475 08 APR 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for SAMMON 475 08 APR 32 investors.

Galaxy Gaming

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Galaxy Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Galaxy Gaming is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SAMMON and Galaxy Gaming

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

The idea behind SAMMON 475 08 APR 32 and Galaxy Gaming 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.