Correlation Between Games Workshop and Blackrock World

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

By analyzing existing cross correlation between Games Workshop Group and Blackrock World Mining, you can compare the effects of market volatilities on Games Workshop and Blackrock World 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 Games Workshop with a short position of Blackrock World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Games Workshop and Blackrock World.

Diversification Opportunities for Games Workshop and Blackrock World

-0.02

Correlation Coefficient

Games Workshop  Blackrock World

Good diversification

The 3 months correlation between Games and Blackrock is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Games Workshop Group and Blackrock World Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock World Mining and Games Workshop 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 Games Workshop Group are associated (or correlated) with Blackrock World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock World Mining has no effect on the direction of Games Workshop i.e., Games Workshop and Blackrock World go up and down completely randomly.

Pair Corralation between Games Workshop and Blackrock World

Assuming the 90 days trading horizon Games Workshop Group is expected to generate 1.65 times more return on investment than Blackrock World. However, Games Workshop is 1.65 times more volatile than Blackrock World Mining. It trades about 0.2 of its potential returns per unit of risk. Blackrock World Mining is currently generating about 0.07 per unit of risk. If you would invest  1,032,639  in Games Workshop Group on September 12, 2024 and sell it today you would earn a total of  357,361  from holding Games Workshop Group or generate 34.61% return on investment over 90 days.

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

Games Workshop Group  vs.  Blackrock World Mining

Games Workshop Group

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Games Workshop Group are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Games Workshop exhibited solid returns over the last few months and may actually be approaching a breakup point.

Blackrock World Mining

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock World Mining are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Blackrock World is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Games Workshop and Blackrock World

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

The idea behind Games Workshop Group and Blackrock World Mining 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.