Correlation Between GAMING FAC and ADRIATIC METALS

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

By analyzing existing cross correlation between GAMING FAC SA and ADRIATIC METALS LS 013355, you can compare the effects of market volatilities on GAMING FAC and ADRIATIC METALS 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 GAMING FAC with a short position of ADRIATIC METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMING FAC and ADRIATIC METALS.

Diversification Opportunities for GAMING FAC and ADRIATIC METALS

-0.6

Correlation Coefficient

GAMING FAC  ADRIATIC METALS

Excellent diversification

The 3 months correlation between GAMING and ADRIATIC is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding GAMING FAC SA and ADRIATIC METALS LS 013355 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADRIATIC METALS LS and GAMING FAC 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 GAMING FAC SA are associated (or correlated) with ADRIATIC METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADRIATIC METALS LS has no effect on the direction of GAMING FAC i.e., GAMING FAC and ADRIATIC METALS go up and down completely randomly.

Pair Corralation between GAMING FAC and ADRIATIC METALS

Assuming the 90 days horizon GAMING FAC SA is expected to under-perform the ADRIATIC METALS. But the stock apears to be less risky and, when comparing its historical volatility, GAMING FAC SA is 1.26 times less risky than ADRIATIC METALS. The stock trades about -0.23 of its potential returns per unit of risk. The ADRIATIC METALS LS 013355 is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  242.00  in ADRIATIC METALS LS 013355 on September 27, 2024 and sell it today you would lose (12.00) from holding ADRIATIC METALS LS 013355 or give up 4.96% of portfolio value over 90 days.

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

GAMING FAC SA  vs.  ADRIATIC METALS LS 013355

GAMING FAC SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GAMING FAC SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

ADRIATIC METALS LS

Risk-Adjusted Performance

3 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ADRIATIC METALS LS 013355 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ADRIATIC METALS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with GAMING FAC and ADRIATIC METALS

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

The idea behind GAMING FAC SA and ADRIATIC METALS LS 013355 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.