Correlation Between GD Culture and Mobile Global

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

By analyzing existing cross correlation between GD Culture Group and Mobile Global Esports, you can compare the effects of market volatilities on GD Culture and Mobile Global 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 GD Culture with a short position of Mobile Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of GD Culture and Mobile Global.

Diversification Opportunities for GD Culture and Mobile Global

0.83

Correlation Coefficient

GD Culture  Mobile Global

Very poor diversification

The 3 months correlation between GDC and Mobile is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding GD Culture Group and Mobile Global Esports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Global Esports and GD Culture 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 GD Culture Group are associated (or correlated) with Mobile Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Global Esports has no effect on the direction of GD Culture i.e., GD Culture and Mobile Global go up and down completely randomly.

Pair Corralation between GD Culture and Mobile Global

If you would invest  49.00  in Mobile Global Esports on September 4, 2024 and sell it today you would earn a total of  0.00  from holding Mobile Global Esports or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	1.59%
Values	Daily Returns

GD Culture Group  vs.  Mobile Global Esports

GD Culture Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GD Culture Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Mobile Global Esports

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mobile Global Esports has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Mobile Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with GD Culture and Mobile Global

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

The idea behind GD Culture Group and Mobile Global Esports 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.