Correlation Between GAMESTOP and Benchmark Electronics
Can any of the company-specific risk be diversified away by investing in both GAMESTOP and Benchmark Electronics 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 and Benchmark Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMESTOP and Benchmark Electronics, you can compare the effects of market volatilities on GAMESTOP and Benchmark Electronics 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 with a short position of Benchmark Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMESTOP and Benchmark Electronics.
Diversification Opportunities for GAMESTOP and Benchmark Electronics
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GAMESTOP and Benchmark is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding GAMESTOP and Benchmark Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benchmark Electronics and GAMESTOP 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 are associated (or correlated) with Benchmark Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benchmark Electronics has no effect on the direction of GAMESTOP i.e., GAMESTOP and Benchmark Electronics go up and down completely randomly.
Pair Corralation between GAMESTOP and Benchmark Electronics
Assuming the 90 days trading horizon GAMESTOP is expected to generate 2.86 times more return on investment than Benchmark Electronics. However, GAMESTOP is 2.86 times more volatile than Benchmark Electronics. It trades about 0.22 of its potential returns per unit of risk. Benchmark Electronics is currently generating about 0.23 per unit of risk. If you would invest 1,005 in GAMESTOP on February 7, 2024 and sell it today you would earn a total of 565.00 from holding GAMESTOP or generate 56.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
GAMESTOP vs. Benchmark Electronics
Performance |
Timeline |
GAMESTOP |
Benchmark Electronics |
GAMESTOP and Benchmark Electronics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GAMESTOP and Benchmark Electronics
The main advantage of trading using opposite GAMESTOP and Benchmark Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMESTOP position performs unexpectedly, Benchmark Electronics 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 Benchmark Electronics will offset losses from the drop in Benchmark Electronics' long position.GAMESTOP vs. Penta Ocean Construction Co | GAMESTOP vs. VASCO DATA SEC | GAMESTOP vs. DOCDATA | GAMESTOP vs. Datadog |
Benchmark Electronics vs. Fevertree Drinks PLC | Benchmark Electronics vs. Coeur Mining | Benchmark Electronics vs. MCEWEN MINING INC | Benchmark Electronics vs. BOSTON BEER A |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
Commodity Directory Find actively traded commodities issued by global exchanges | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |