Correlation Between GameStop Corp and Intelligent Bio

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

By analyzing existing cross correlation between GameStop Corp and Intelligent Bio Solutions, you can compare the effects of market volatilities on GameStop Corp and Intelligent Bio 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 GameStop Corp with a short position of Intelligent Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of GameStop Corp and Intelligent Bio.

Diversification Opportunities for GameStop Corp and Intelligent Bio

-0.15

Correlation Coefficient

GameStop Corp  Intelligent Bio

Good diversification

The 3 months correlation between GameStop and Intelligent is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GameStop Corp and Intelligent Bio Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelligent Bio Solutions and GameStop Corp 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 GameStop Corp are associated (or correlated) with Intelligent Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelligent Bio Solutions has no effect on the direction of GameStop Corp i.e., GameStop Corp and Intelligent Bio go up and down completely randomly.

Pair Corralation between GameStop Corp and Intelligent Bio

Considering the 90-day investment horizon GameStop Corp is expected to generate 0.59 times more return on investment than Intelligent Bio. However, GameStop Corp is 1.68 times less risky than Intelligent Bio. It trades about 0.09 of its potential returns per unit of risk. Intelligent Bio Solutions is currently generating about 0.0 per unit of risk. If you would invest  2,333  in GameStop Corp on September 29, 2024 and sell it today you would earn a total of  887.00  from holding GameStop Corp or generate 38.02% return on investment over 90 days.

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

GameStop Corp  vs.  Intelligent Bio Solutions

GameStop Corp

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GameStop Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain primary indicators, GameStop Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.

Intelligent Bio Solutions

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intelligent Bio Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's fundamental drivers remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with GameStop Corp and Intelligent Bio

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

The idea behind GameStop Corp and Intelligent Bio Solutions 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.