This module allows you to analyze existing cross correlation between The Walt Disney Company and Electronic Arts Inc. You can compare the effects of market volatilities on Disney and Electronic Arts 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 Disney with a short position of Electronic Arts. See also your portfolio center
. Please also check ongoing floating volatility patterns of Disney
and Electronic Arts
The Walt Disney Company vs Electronic Arts Inc.
Considering 30-days investment horizon, The Walt Disney Company is expected to under-perform the Electronic Arts. But the stock apears to be less risky and, when comparing its historical volatility, The Walt Disney Company is 3.46 times less risky than Electronic Arts. The stock trades about -0.29 of its potential returns per unit of risk. The Electronic Arts Inc is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 9,479 in Electronic Arts Inc on April 30, 2017 and sell it today you would earn a total of 1,734 from holding Electronic Arts Inc or generate 18.29% return on investment over 30 days.
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Overlapping area represents the amount of risk that can be diversified away by holding The Walt Disney Company and Electronic Arts Inc. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Disney 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 The Walt Disney Company are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Disney i.e. Disney and Electronic Arts go up and down completely randomly.
Over the last 30 days The Walt Disney Company has generated negative risk-adjusted returns adding no value to investors with long positions.
Compared to the overall equity markets, risk-adjusted returns on investments in Electronic Arts Inc are ranked lower than 18 (%) of all global equities and portfolios over the last 30 days.