Correlation Between XLMedia PLC and Penn National
Can any of the company-specific risk be diversified away by investing in both XLMedia PLC and Penn National 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 XLMedia PLC and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XLMedia PLC and Penn National Gaming, you can compare the effects of market volatilities on XLMedia PLC and Penn National 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 XLMedia PLC with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of XLMedia PLC and Penn National.
Diversification Opportunities for XLMedia PLC and Penn National
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XLMedia and Penn is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding XLMedia PLC and Penn National Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penn National Gaming and XLMedia PLC 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 XLMedia PLC are associated (or correlated) with Penn National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penn National Gaming has no effect on the direction of XLMedia PLC i.e., XLMedia PLC and Penn National go up and down completely randomly.
Pair Corralation between XLMedia PLC and Penn National
If you would invest 1,771 in Penn National Gaming on September 4, 2024 and sell it today you would earn a total of 213.00 from holding Penn National Gaming or generate 12.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XLMedia PLC vs. Penn National Gaming
Performance |
| Timeline |
| XLMedia PLC |
| Penn National Gaming |
XLMedia PLC and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XLMedia PLC and Penn National
The main advantage of trading using opposite XLMedia PLC and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XLMedia PLC position performs unexpectedly, Penn National 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 National will offset losses from the drop in Penn National's long position.| XLMedia PLC vs. Alphabet Class A | XLMedia PLC vs. Meta Platforms | XLMedia PLC vs. Meta Platforms | XLMedia PLC vs. Prosus NV |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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