Correlation Between Games Workshop and London Security
Can any of the company-specific risk be diversified away by investing in both Games Workshop and London Security 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 Games Workshop and London Security into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Games Workshop Group and London Security Plc, you can compare the effects of market volatilities on Games Workshop and London Security 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 Games Workshop with a short position of London Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of Games Workshop and London Security.
Diversification Opportunities for Games Workshop and London Security
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Games and London is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Games Workshop Group and London Security Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on London Security Plc and Games Workshop 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 Games Workshop Group are associated (or correlated) with London Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of London Security Plc has no effect on the direction of Games Workshop i.e., Games Workshop and London Security go up and down completely randomly.
Pair Corralation between Games Workshop and London Security
Assuming the 90 days trading horizon Games Workshop is expected to generate 95.21 times less return on investment than London Security. But when comparing it to its historical volatility, Games Workshop Group is 99.99 times less risky than London Security. It trades about 0.21 of its potential returns per unit of risk. London Security Plc is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 3,392 in London Security Plc on September 11, 2025 and sell it today you would earn a total of 281,608 from holding London Security Plc or generate 8302.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Games Workshop Group vs. London Security Plc
Performance |
| Timeline |
| Games Workshop Group |
| London Security Plc |
Games Workshop and London Security Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Games Workshop and London Security
The main advantage of trading using opposite Games Workshop and London Security positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Games Workshop position performs unexpectedly, London Security 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 London Security will offset losses from the drop in London Security's long position.| Games Workshop vs. Samsung Electronics Co | Games Workshop vs. Samsung Electronics Co | Games Workshop vs. Samsung Electronics Co | Games Workshop vs. Toyota Motor Corp |
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Check out your portfolio center.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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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