Correlation Between PlayAGS and Noodles
Can any of the company-specific risk be diversified away by investing in both PlayAGS and Noodles 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 PlayAGS and Noodles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PlayAGS and Noodles Company, you can compare the effects of market volatilities on PlayAGS and Noodles 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 PlayAGS with a short position of Noodles. Check out your portfolio center. Please also check ongoing floating volatility patterns of PlayAGS and Noodles.
Diversification Opportunities for PlayAGS and Noodles
Excellent diversification
The 3 months correlation between PlayAGS and Noodles is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding PlayAGS and Noodles Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Noodles Company and PlayAGS 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 PlayAGS are associated (or correlated) with Noodles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Noodles Company has no effect on the direction of PlayAGS i.e., PlayAGS and Noodles go up and down completely randomly.
Pair Corralation between PlayAGS and Noodles
Considering the 90-day investment horizon PlayAGS is expected to generate 0.04 times more return on investment than Noodles. However, PlayAGS is 26.22 times less risky than Noodles. It trades about -0.02 of its potential returns per unit of risk. Noodles Company is currently generating about -0.43 per unit of risk. If you would invest 1,163 in PlayAGS on August 31, 2024 and sell it today you would lose (1.00) from holding PlayAGS or give up 0.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PlayAGS vs. Noodles Company
Performance |
| Timeline |
| PlayAGS |
| Noodles Company |
PlayAGS and Noodles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PlayAGS and Noodles
The main advantage of trading using opposite PlayAGS and Noodles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PlayAGS position performs unexpectedly, Noodles 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 Noodles will offset losses from the drop in Noodles' long position.| PlayAGS vs. Light Wonder | PlayAGS vs. Everi Holdings | PlayAGS vs. Inspired Entertainment | PlayAGS vs. International Game Technology |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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