Correlation Between Champion Gaming and Asbury Automotive

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

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

Diversification Opportunities for Champion Gaming and Asbury Automotive

0.0

Correlation Coefficient

Champion Gaming  Asbury Automotive

Pay attention - limited upside

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

Pair Corralation between Champion Gaming and Asbury Automotive

If you would invest  22,828  in Asbury Automotive Group on October 8, 2024 and sell it today you would earn a total of  865.00  from holding Asbury Automotive Group or generate 3.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Champion Gaming Group  vs.  Asbury Automotive Group

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 latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Asbury Automotive

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Asbury Automotive Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental drivers, Asbury Automotive is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Champion Gaming and Asbury Automotive

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

The idea behind Champion Gaming Group and Asbury Automotive 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.