Correlation Between Caesars Entertainment, and Medical Properties
Can any of the company-specific risk be diversified away by investing in both Caesars Entertainment, and Medical Properties 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 Caesars Entertainment, and Medical Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caesars Entertainment, and Medical Properties Trust,, you can compare the effects of market volatilities on Caesars Entertainment, and Medical Properties 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 Caesars Entertainment, with a short position of Medical Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caesars Entertainment, and Medical Properties.
Diversification Opportunities for Caesars Entertainment, and Medical Properties
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Caesars and Medical is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Caesars Entertainment, and Medical Properties Trust, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medical Properties Trust, and Caesars Entertainment, 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 Caesars Entertainment, are associated (or correlated) with Medical Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medical Properties Trust, has no effect on the direction of Caesars Entertainment, i.e., Caesars Entertainment, and Medical Properties go up and down completely randomly.
Pair Corralation between Caesars Entertainment, and Medical Properties
Assuming the 90 days trading horizon Caesars Entertainment, is expected to under-perform the Medical Properties. But the stock apears to be less risky and, when comparing its historical volatility, Caesars Entertainment, is 1.27 times less risky than Medical Properties. The stock trades about -0.08 of its potential returns per unit of risk. The Medical Properties Trust, is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,281 in Medical Properties Trust, on October 26, 2024 and sell it today you would earn a total of 69.00 from holding Medical Properties Trust, or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caesars Entertainment, vs. Medical Properties Trust,
Performance |
| Timeline |
| Caesars Entertainment, |
| Medical Properties Trust, |
Caesars Entertainment, and Medical Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caesars Entertainment, and Medical Properties
The main advantage of trading using opposite Caesars Entertainment, and Medical Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caesars Entertainment, position performs unexpectedly, Medical Properties 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 Medical Properties will offset losses from the drop in Medical Properties' long position.| Caesars Entertainment, vs. Taiwan Semiconductor Manufacturing | Caesars Entertainment, vs. Apple Inc | Caesars Entertainment, vs. Alibaba Group Holding | Caesars Entertainment, vs. Microsoft |
| Medical Properties vs. Ryanair Holdings plc | Medical Properties vs. SK Telecom Co, | Medical Properties vs. Unifique Telecomunicaes SA | Medical Properties vs. Marvell 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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