Correlation Between AGNC INVESTMENT and PENN Entertainment
Can any of the company-specific risk be diversified away by investing in both AGNC INVESTMENT and PENN Entertainment 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 AGNC INVESTMENT and PENN Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGNC INVESTMENT and PENN Entertainment, you can compare the effects of market volatilities on AGNC INVESTMENT and PENN Entertainment 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 AGNC INVESTMENT with a short position of PENN Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGNC INVESTMENT and PENN Entertainment.
Diversification Opportunities for AGNC INVESTMENT and PENN Entertainment
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AGNC and PENN is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding AGNC INVESTMENT and PENN Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PENN Entertainment and AGNC INVESTMENT 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 AGNC INVESTMENT are associated (or correlated) with PENN Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PENN Entertainment has no effect on the direction of AGNC INVESTMENT i.e., AGNC INVESTMENT and PENN Entertainment go up and down completely randomly.
Pair Corralation between AGNC INVESTMENT and PENN Entertainment
Assuming the 90 days trading horizon AGNC INVESTMENT is expected to generate 1.54 times less return on investment than PENN Entertainment. But when comparing it to its historical volatility, AGNC INVESTMENT is 2.18 times less risky than PENN Entertainment. It trades about 0.22 of its potential returns per unit of risk. PENN Entertainment is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,799 in PENN Entertainment on November 4, 2024 and sell it today you would earn a total of 164.00 from holding PENN Entertainment or generate 9.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGNC INVESTMENT vs. PENN Entertainment
Performance |
| Timeline |
| AGNC INVESTMENT |
| PENN Entertainment |
AGNC INVESTMENT and PENN Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGNC INVESTMENT and PENN Entertainment
The main advantage of trading using opposite AGNC INVESTMENT and PENN Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGNC INVESTMENT position performs unexpectedly, PENN Entertainment 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 PENN Entertainment will offset losses from the drop in PENN Entertainment's long position.| AGNC INVESTMENT vs. CN MODERN DAIRY | AGNC INVESTMENT vs. LIFEWAY FOODS | AGNC INVESTMENT vs. United Natural Foods | AGNC INVESTMENT vs. Align Technology |
| PENN Entertainment vs. MARKET VECTR RETAIL | PENN Entertainment vs. ATRESMEDIA | PENN Entertainment vs. G III Apparel Group | PENN Entertainment vs. COSTCO WHOLESALE CDR |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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