Correlation Between Detalion Games and Beta ETF

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

By analyzing existing cross correlation between Detalion Games SA and Beta ETF WIG20lev, you can compare the effects of market volatilities on Detalion Games and Beta ETF 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 Detalion Games with a short position of Beta ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Detalion Games and Beta ETF.

Diversification Opportunities for Detalion Games and Beta ETF

0.49

Correlation Coefficient

Detalion Games  Beta ETF

Very weak diversification

The 3 months correlation between Detalion and Beta is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Detalion Games SA and Beta ETF WIG20lev in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beta ETF WIG20lev and Detalion 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 Detalion Games SA are associated (or correlated) with Beta ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beta ETF WIG20lev has no effect on the direction of Detalion Games i.e., Detalion Games and Beta ETF go up and down completely randomly.

Pair Corralation between Detalion Games and Beta ETF

Assuming the 90 days trading horizon Detalion Games SA is expected to under-perform the Beta ETF. In addition to that, Detalion Games is 1.85 times more volatile than Beta ETF WIG20lev. It trades about -0.23 of its total potential returns per unit of risk. Beta ETF WIG20lev is currently generating about -0.01 per unit of volatility. If you would invest  4,106  in Beta ETF WIG20lev on September 16, 2024 and sell it today you would lose (145.00) from holding Beta ETF WIG20lev or give up 3.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	57.81%
Values	Daily Returns

Detalion Games SA  vs.  Beta ETF WIG20lev

Detalion Games SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Detalion Games SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Beta ETF WIG20lev

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Beta ETF WIG20lev has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Beta ETF is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Detalion Games and Beta ETF

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

The idea behind Detalion Games SA and Beta ETF WIG20lev 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.