Correlation Between ECC Games and SOFTWARE MANSION

Can any of the company-specific risk be diversified away by investing in both ECC Games and SOFTWARE MANSION 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 ECC Games and SOFTWARE MANSION into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ECC Games SA and SOFTWARE MANSION SPOLKA, you can compare the effects of market volatilities on ECC Games and SOFTWARE MANSION 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 ECC Games with a short position of SOFTWARE MANSION. Check out your portfolio center. Please also check ongoing floating volatility patterns of ECC Games and SOFTWARE MANSION.

Diversification Opportunities for ECC Games and SOFTWARE MANSION

-0.54

Correlation Coefficient

ECC Games  SOFTWARE MANSION

Excellent diversification

The 3 months correlation between ECC and SOFTWARE is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding ECC Games SA and SOFTWARE MANSION SPOLKA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOFTWARE MANSION SPOLKA and ECC Games 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 ECC Games SA are associated (or correlated) with SOFTWARE MANSION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOFTWARE MANSION SPOLKA has no effect on the direction of ECC Games i.e., ECC Games and SOFTWARE MANSION go up and down completely randomly.

Pair Corralation between ECC Games and SOFTWARE MANSION

Assuming the 90 days trading horizon ECC Games SA is expected to under-perform the SOFTWARE MANSION. In addition to that, ECC Games is 1.58 times more volatile than SOFTWARE MANSION SPOLKA. It trades about -0.06 of its total potential returns per unit of risk. SOFTWARE MANSION SPOLKA is currently generating about 0.21 per unit of volatility. If you would invest  3,800  in SOFTWARE MANSION SPOLKA on April 24, 2025 and sell it today you would earn a total of  1,450  from holding SOFTWARE MANSION SPOLKA or generate 38.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.55%
Values	Daily Returns

ECC Games SA  vs.  SOFTWARE MANSION SPOLKA

ECC Games SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days ECC Games SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in August 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

SOFTWARE MANSION SPOLKA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SOFTWARE MANSION SPOLKA are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, SOFTWARE MANSION reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ECC Games and SOFTWARE MANSION

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

The idea behind ECC Games SA and SOFTWARE MANSION SPOLKA 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.