Correlation Between GameStop Corp and MoneyHero Limited

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

By analyzing existing cross correlation between GameStop Corp and MoneyHero Limited Class, you can compare the effects of market volatilities on GameStop Corp and MoneyHero Limited 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 MoneyHero Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of GameStop Corp and MoneyHero Limited.

Diversification Opportunities for GameStop Corp and MoneyHero Limited

0.3

Correlation Coefficient

GameStop Corp  MoneyHero Limited

Weak diversification

The 3 months correlation between GameStop and MoneyHero is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding GameStop Corp and MoneyHero Limited Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MoneyHero Limited Class 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 MoneyHero Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MoneyHero Limited Class has no effect on the direction of GameStop Corp i.e., GameStop Corp and MoneyHero Limited go up and down completely randomly.

Pair Corralation between GameStop Corp and MoneyHero Limited

Considering the 90-day investment horizon GameStop Corp is expected to generate 1.14 times more return on investment than MoneyHero Limited. However, GameStop Corp is 1.14 times more volatile than MoneyHero Limited Class. It trades about 0.15 of its potential returns per unit of risk. MoneyHero Limited Class is currently generating about 0.0 per unit of risk. If you would invest  2,218  in GameStop Corp on September 25, 2024 and sell it today you would earn a total of  764.00  from holding GameStop Corp or generate 34.45% return on investment over 90 days.

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

GameStop Corp  vs.  MoneyHero Limited Class

GameStop Corp

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GameStop Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, GameStop Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.

MoneyHero Limited Class

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MoneyHero Limited Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, MoneyHero Limited is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GameStop Corp and MoneyHero Limited

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

The idea behind GameStop Corp and MoneyHero Limited Class 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.