Correlation Between Fractal Gaming and Pierce Group

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

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

Diversification Opportunities for Fractal Gaming and Pierce Group

-0.39

Correlation Coefficient

Fractal Gaming  Pierce Group

Very good diversification

The 3 months correlation between Fractal and Pierce is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Fractal Gaming Group and Pierce Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pierce Group AB and Fractal 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 Fractal Gaming Group are associated (or correlated) with Pierce Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pierce Group AB has no effect on the direction of Fractal Gaming i.e., Fractal Gaming and Pierce Group go up and down completely randomly.

Pair Corralation between Fractal Gaming and Pierce Group

Assuming the 90 days trading horizon Fractal Gaming Group is expected to generate 0.56 times more return on investment than Pierce Group. However, Fractal Gaming Group is 1.8 times less risky than Pierce Group. It trades about 0.3 of its potential returns per unit of risk. Pierce Group AB is currently generating about 0.01 per unit of risk. If you would invest  3,482  in Fractal Gaming Group on April 25, 2025 and sell it today you would earn a total of  1,373  from holding Fractal Gaming Group or generate 39.43% return on investment over 90 days.

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

Fractal Gaming Group  vs.  Pierce Group AB

Fractal Gaming Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fractal Gaming Group are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Fractal Gaming sustained solid returns over the last few months and may actually be approaching a breakup point.

Pierce Group AB

Risk-Adjusted Performance

Insignificant

Over the last 90 days Pierce Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Pierce Group is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fractal Gaming and Pierce Group

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

The idea behind Fractal Gaming Group and Pierce Group AB 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.