Correlation Between Champion Gaming and Bilibili

Can any of the company-specific risk be diversified away by investing in both Champion Gaming and Bilibili 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 Bilibili 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 Bilibili, you can compare the effects of market volatilities on Champion Gaming and Bilibili 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 Bilibili. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Gaming and Bilibili.

Diversification Opportunities for Champion Gaming and Bilibili

0.51

Correlation Coefficient

Champion Gaming  Bilibili

Very weak diversification

The 3 months correlation between Champion and Bilibili is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Champion Gaming Group and Bilibili in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilibili 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 Bilibili. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilibili has no effect on the direction of Champion Gaming i.e., Champion Gaming and Bilibili go up and down completely randomly.

Pair Corralation between Champion Gaming and Bilibili

Assuming the 90 days horizon Champion Gaming Group is expected to generate 2.04 times more return on investment than Bilibili. However, Champion Gaming is 2.04 times more volatile than Bilibili. It trades about 0.0 of its potential returns per unit of risk. Bilibili is currently generating about 0.0 per unit of risk. If you would invest  5.82  in Champion Gaming Group on October 23, 2024 and sell it today you would lose (5.52) from holding Champion Gaming Group or give up 94.85% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Champion Gaming Group  vs.  Bilibili

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 unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Bilibili

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bilibili has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's essential indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Champion Gaming and Bilibili

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

The idea behind Champion Gaming Group and Bilibili 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.