Correlation Between EAST SIDE and Penn National
Can any of the company-specific risk be diversified away by investing in both EAST SIDE 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 EAST SIDE and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EAST SIDE GAMES and Penn National Gaming, you can compare the effects of market volatilities on EAST SIDE 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 EAST SIDE with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of EAST SIDE and Penn National.
Diversification Opportunities for EAST SIDE and Penn National
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EAST and Penn is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding EAST SIDE GAMES 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 EAST SIDE 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 EAST SIDE GAMES 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 EAST SIDE i.e., EAST SIDE and Penn National go up and down completely randomly.
Pair Corralation between EAST SIDE and Penn National
Assuming the 90 days horizon EAST SIDE GAMES is expected to under-perform the Penn National. In addition to that, EAST SIDE is 2.16 times more volatile than Penn National Gaming. It trades about -0.18 of its total potential returns per unit of risk. Penn National Gaming is currently generating about 0.18 per unit of volatility. If you would invest 1,798 in Penn National Gaming on September 2, 2024 and sell it today you would earn a total of 186.00 from holding Penn National Gaming or generate 10.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EAST SIDE GAMES vs. Penn National Gaming
Performance |
| Timeline |
| EAST SIDE GAMES |
| Penn National Gaming |
EAST SIDE and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EAST SIDE and Penn National
The main advantage of trading using opposite EAST SIDE and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EAST SIDE 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.| EAST SIDE vs. Nintendo Co | EAST SIDE vs. Sea Limited | EAST SIDE vs. Superior Plus Corp | EAST SIDE vs. NMI Holdings |
| Penn National vs. Superior Plus Corp | Penn National vs. NMI Holdings | Penn National vs. Origin Agritech | Penn National vs. SIVERS SEMICONDUCTORS AB |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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