Correlation Between PLATO GOLD and MGM Resorts
Can any of the company-specific risk be diversified away by investing in both PLATO GOLD and MGM Resorts 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 PLATO GOLD and MGM Resorts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLATO GOLD P and MGM Resorts International, you can compare the effects of market volatilities on PLATO GOLD and MGM Resorts 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 PLATO GOLD with a short position of MGM Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLATO GOLD and MGM Resorts.
Diversification Opportunities for PLATO GOLD and MGM Resorts
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PLATO and MGM is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PLATO GOLD P and MGM Resorts International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGM Resorts International and PLATO GOLD 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 PLATO GOLD P are associated (or correlated) with MGM Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGM Resorts International has no effect on the direction of PLATO GOLD i.e., PLATO GOLD and MGM Resorts go up and down completely randomly.
Pair Corralation between PLATO GOLD and MGM Resorts
Assuming the 90 days horizon PLATO GOLD P is expected to generate 21.42 times more return on investment than MGM Resorts. However, PLATO GOLD is 21.42 times more volatile than MGM Resorts International. It trades about 0.09 of its potential returns per unit of risk. MGM Resorts International is currently generating about 0.01 per unit of risk. If you would invest 1.05 in PLATO GOLD P on September 2, 2024 and sell it today you would lose (0.70) from holding PLATO GOLD P or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLATO GOLD P vs. MGM Resorts International
Performance |
| Timeline |
| PLATO GOLD P |
| MGM Resorts International |
PLATO GOLD and MGM Resorts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLATO GOLD and MGM Resorts
The main advantage of trading using opposite PLATO GOLD and MGM Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLATO GOLD position performs unexpectedly, MGM Resorts 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 MGM Resorts will offset losses from the drop in MGM Resorts' long position.| PLATO GOLD vs. ZIJIN MINH UNSPADR20 | PLATO GOLD vs. Superior Plus Corp | PLATO GOLD vs. NMI Holdings | PLATO GOLD vs. Origin Agritech |
| MGM Resorts vs. MAGNUM MINING EXP | MGM Resorts vs. Calibre Mining Corp | MGM Resorts vs. Iridium Communications | MGM Resorts vs. Sumitomo Chemical |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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