Correlation Between GAMES OPERATORS and Haier Smart

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

By analyzing existing cross correlation between GAMES OPERATORS SA and Haier Smart Home, you can compare the effects of market volatilities on GAMES OPERATORS and Haier Smart 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 GAMES OPERATORS with a short position of Haier Smart. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMES OPERATORS and Haier Smart.

Diversification Opportunities for GAMES OPERATORS and Haier Smart

0.34

Correlation Coefficient

GAMES OPERATORS  Haier Smart

Weak diversification

The 3 months correlation between GAMES and Haier is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding GAMES OPERATORS SA and Haier Smart Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haier Smart Home and GAMES OPERATORS 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 GAMES OPERATORS SA are associated (or correlated) with Haier Smart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haier Smart Home has no effect on the direction of GAMES OPERATORS i.e., GAMES OPERATORS and Haier Smart go up and down completely randomly.

Pair Corralation between GAMES OPERATORS and Haier Smart

Assuming the 90 days horizon GAMES OPERATORS SA is expected to generate 1.11 times more return on investment than Haier Smart. However, GAMES OPERATORS is 1.11 times more volatile than Haier Smart Home. It trades about 0.09 of its potential returns per unit of risk. Haier Smart Home is currently generating about -0.12 per unit of risk. If you would invest  350.00  in GAMES OPERATORS SA on January 8, 2025 and sell it today you would earn a total of  49.00  from holding GAMES OPERATORS SA or generate 14.0% return on investment over 90 days.

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

GAMES OPERATORS SA  vs.  Haier Smart Home

GAMES OPERATORS SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GAMES OPERATORS SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, GAMES OPERATORS reported solid returns over the last few months and may actually be approaching a breakup point.

Haier Smart Home

Risk-Adjusted Performance

Very Weak

Over the last 90 days Haier Smart Home has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with GAMES OPERATORS and Haier Smart

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

The idea behind GAMES OPERATORS SA and Haier Smart Home 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 Global Correlations module to find global opportunities by holding instruments from different markets.