Correlation Between QINGCI GAMES and Nintendo

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

By analyzing existing cross correlation between QINGCI GAMES INC and Nintendo Co, you can compare the effects of market volatilities on QINGCI GAMES and Nintendo 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 QINGCI GAMES with a short position of Nintendo. Check out your portfolio center. Please also check ongoing floating volatility patterns of QINGCI GAMES and Nintendo.

Diversification Opportunities for QINGCI GAMES and Nintendo

-0.36

Correlation Coefficient

QINGCI GAMES  Nintendo

Very good diversification

The 3 months correlation between QINGCI and Nintendo is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding QINGCI GAMES INC and Nintendo Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nintendo and QINGCI GAMES 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 QINGCI GAMES INC are associated (or correlated) with Nintendo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nintendo has no effect on the direction of QINGCI GAMES i.e., QINGCI GAMES and Nintendo go up and down completely randomly.

Pair Corralation between QINGCI GAMES and Nintendo

Assuming the 90 days horizon QINGCI GAMES is expected to generate 6.03 times less return on investment than Nintendo. In addition to that, QINGCI GAMES is 1.6 times more volatile than Nintendo Co. It trades about 0.01 of its total potential returns per unit of risk. Nintendo Co is currently generating about 0.1 per unit of volatility. If you would invest  5,622  in Nintendo Co on December 30, 2024 and sell it today you would earn a total of  978.00  from holding Nintendo Co or generate 17.4% return on investment over 90 days.

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

QINGCI GAMES INC  vs.  Nintendo Co

QINGCI GAMES INC

Risk-Adjusted Performance

Very Weak

Over the last 90 days QINGCI GAMES INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, QINGCI GAMES is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Nintendo

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nintendo Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Nintendo reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with QINGCI GAMES and Nintendo

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

The idea behind QINGCI GAMES INC and Nintendo Co 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.

Check out your portfolio center.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.