Correlation Between GDEV and Konami Holdings

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

By analyzing existing cross correlation between GDEV Inc and Konami Holdings, you can compare the effects of market volatilities on GDEV and Konami Holdings 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 GDEV with a short position of Konami Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of GDEV and Konami Holdings.

Diversification Opportunities for GDEV and Konami Holdings

0.01

Correlation Coefficient

GDEV  Konami Holdings

Significant diversification

The 3 months correlation between GDEV and Konami is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding GDEV Inc and Konami Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konami Holdings and GDEV 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 GDEV Inc are associated (or correlated) with Konami Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konami Holdings has no effect on the direction of GDEV i.e., GDEV and Konami Holdings go up and down completely randomly.

Pair Corralation between GDEV and Konami Holdings

Given the investment horizon of 90 days GDEV Inc is expected to generate 3.67 times more return on investment than Konami Holdings. However, GDEV is 3.67 times more volatile than Konami Holdings. It trades about 0.05 of its potential returns per unit of risk. Konami Holdings is currently generating about 0.09 per unit of risk. If you would invest  2,201  in GDEV Inc on September 3, 2024 and sell it today you would earn a total of  113.00  from holding GDEV Inc or generate 5.13% return on investment over 90 days.

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

GDEV Inc  vs.  Konami Holdings

GDEV Inc

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GDEV Inc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, GDEV showed solid returns over the last few months and may actually be approaching a breakup point.

Konami Holdings

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Konami Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile primary indicators, Konami Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with GDEV and Konami Holdings

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

The idea behind GDEV Inc and Konami Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.