Correlation Between Sega Sammy and GDEV

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

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

Diversification Opportunities for Sega Sammy and GDEV

0.32

Correlation Coefficient

Sega Sammy  GDEV

Weak diversification

The 3 months correlation between Sega and GDEV is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Sega Sammy Holdings and GDEV Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GDEV Inc and Sega Sammy 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 Sega Sammy Holdings are associated (or correlated) with GDEV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GDEV Inc has no effect on the direction of Sega Sammy i.e., Sega Sammy and GDEV go up and down completely randomly.

Pair Corralation between Sega Sammy and GDEV

Assuming the 90 days horizon Sega Sammy Holdings is expected to under-perform the GDEV. But the pink sheet apears to be less risky and, when comparing its historical volatility, Sega Sammy Holdings is 2.86 times less risky than GDEV. The pink sheet trades about 0.0 of its potential returns per unit of risk. The GDEV Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. 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	Very Weak
Accuracy	100.0%
Values	Daily Returns

Sega Sammy Holdings  vs.  GDEV Inc

Sega Sammy Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

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.

Pair Trading with Sega Sammy and GDEV

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

The idea behind Sega Sammy Holdings and GDEV Inc 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.