Correlation Between Bragg Gaming and Invesco Summit

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

By analyzing existing cross correlation between Bragg Gaming Group and Invesco Summit Fund, you can compare the effects of market volatilities on Bragg Gaming and Invesco Summit 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 Bragg Gaming with a short position of Invesco Summit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bragg Gaming and Invesco Summit.

Diversification Opportunities for Bragg Gaming and Invesco Summit

0.51

Correlation Coefficient

Bragg Gaming  Invesco Summit

Very weak diversification

The 3 months correlation between Bragg and Invesco is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bragg Gaming Group and Invesco Summit Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Summit and Bragg Gaming 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 Bragg Gaming Group are associated (or correlated) with Invesco Summit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Summit has no effect on the direction of Bragg Gaming i.e., Bragg Gaming and Invesco Summit go up and down completely randomly.

Pair Corralation between Bragg Gaming and Invesco Summit

Assuming the 90 days trading horizon Bragg Gaming Group is expected to generate 4.08 times more return on investment than Invesco Summit. However, Bragg Gaming is 4.08 times more volatile than Invesco Summit Fund. It trades about 0.28 of its potential returns per unit of risk. Invesco Summit Fund is currently generating about -0.22 per unit of risk. If you would invest  676.00  in Bragg Gaming Group on January 20, 2024 and sell it today you would earn a total of  174.00  from holding Bragg Gaming Group or generate 25.74% return on investment over 90 days.

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

Bragg Gaming Group  vs.  Invesco Summit Fund

Bragg Gaming Group

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bragg Gaming Group are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Bragg Gaming displayed solid returns over the last few months and may actually be approaching a breakup point.

Invesco Summit

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Summit Fund are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Invesco Summit is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bragg Gaming and Invesco Summit

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

The idea behind Bragg Gaming Group and Invesco Summit Fund 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.