Correlation Between Champion Gaming and AMERICAN

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

Diversification Opportunities for Champion Gaming and AMERICAN

0.0

Correlation Coefficient

Champion Gaming  AMERICAN

Pay attention - limited upside

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

Pair Corralation between Champion Gaming and AMERICAN

Assuming the 90 days horizon Champion Gaming Group is expected to generate 23.02 times more return on investment than AMERICAN. However, Champion Gaming is 23.02 times more volatile than AMERICAN TOWER P. It trades about 0.03 of its potential returns per unit of risk. AMERICAN TOWER P is currently generating about -0.01 per unit of risk. If you would invest  5.82  in Champion Gaming Group on October 11, 2024 and sell it today you would lose (0.82) from holding Champion Gaming Group or give up 14.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.39%
Values	Daily Returns

Champion Gaming Group  vs.  AMERICAN TOWER P

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

AMERICAN TOWER P

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Champion Gaming and AMERICAN

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

The idea behind Champion Gaming Group and AMERICAN TOWER P 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..