Correlation Between Bragg Gaming and Airbus Group

Can any of the company-specific risk be diversified away by investing in both Bragg Gaming and Airbus Group 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 Airbus Group 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 Airbus Group SE, you can compare the effects of market volatilities on Bragg Gaming and Airbus Group 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 Airbus Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bragg Gaming and Airbus Group.

Diversification Opportunities for Bragg Gaming and Airbus Group

0.23

Correlation Coefficient

Bragg Gaming  Airbus Group

Modest diversification

The 3 months correlation between Bragg and Airbus is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bragg Gaming Group and Airbus Group SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airbus Group SE 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 Airbus Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airbus Group SE has no effect on the direction of Bragg Gaming i.e., Bragg Gaming and Airbus Group go up and down completely randomly.

Pair Corralation between Bragg Gaming and Airbus Group

Assuming the 90 days trading horizon Bragg Gaming is expected to generate 1.45 times less return on investment than Airbus Group. In addition to that, Bragg Gaming is 1.9 times more volatile than Airbus Group SE. It trades about 0.03 of its total potential returns per unit of risk. Airbus Group SE is currently generating about 0.08 per unit of volatility. If you would invest  16,046  in Airbus Group SE on February 9, 2024 and sell it today you would earn a total of  1,254  from holding Airbus Group SE or generate 7.82% return on investment over 90 days.

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

Bragg Gaming Group  vs.  Airbus Group SE

Bragg Gaming Group

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bragg Gaming Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Bragg Gaming is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Airbus Group SE

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Airbus Group SE are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Airbus Group may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Pair Trading with Bragg Gaming and Airbus Group

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

The idea behind Bragg Gaming Group and Airbus Group SE 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.