Correlation Between Hasbro and International Game
Can any of the company-specific risk be diversified away by investing in both Hasbro and International Game 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 Hasbro and International Game into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and International Game Technology, you can compare the effects of market volatilities on Hasbro and International Game 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 Hasbro with a short position of International Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and International Game.
Diversification Opportunities for Hasbro and International Game
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hasbro and International is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and International Game Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Game and Hasbro 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 Hasbro Inc are associated (or correlated) with International Game. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Game has no effect on the direction of Hasbro i.e., Hasbro and International Game go up and down completely randomly.
Pair Corralation between Hasbro and International Game
Considering the 90-day investment horizon Hasbro Inc is expected to generate 1.42 times more return on investment than International Game. However, Hasbro is 1.42 times more volatile than International Game Technology. It trades about 0.3 of its potential returns per unit of risk. International Game Technology is currently generating about -0.08 per unit of risk. If you would invest 5,461 in Hasbro Inc on January 26, 2024 and sell it today you would earn a total of 1,042 from holding Hasbro Inc or generate 19.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hasbro Inc vs. International Game Technology
Performance |
| Timeline |
| Hasbro Inc |
| International Game |
Hasbro and International Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hasbro and International Game
The main advantage of trading using opposite Hasbro and International Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, International Game 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 International Game will offset losses from the drop in International Game's long position.| Hasbro vs. First Business Financial | Hasbro vs. Flexsteel Industries | Hasbro vs. Superior Uniform Group | Hasbro vs. Eastern Co |
| International Game vs. PlayAGS | International Game vs. Inspired Entertainment | International Game vs. Light Wonder |
Check out your portfolio center.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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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