Correlation Between Century Casinos and MGM Resorts
Can any of the company-specific risk be diversified away by investing in both Century Casinos 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 Century Casinos and MGM Resorts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Casinos and MGM Resorts International, you can compare the effects of market volatilities on Century Casinos 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 Century Casinos with a short position of MGM Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Casinos and MGM Resorts.
Diversification Opportunities for Century Casinos and MGM Resorts
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Century and MGM is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Century Casinos 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 Century Casinos 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 Century Casinos 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 Century Casinos i.e., Century Casinos and MGM Resorts go up and down completely randomly.
Pair Corralation between Century Casinos and MGM Resorts
Given the investment horizon of 90 days Century Casinos is expected to generate 1.62 times more return on investment than MGM Resorts. However, Century Casinos is 1.62 times more volatile than MGM Resorts International. It trades about 0.33 of its potential returns per unit of risk. MGM Resorts International is currently generating about -0.17 per unit of risk. If you would invest 330.00 in Century Casinos on August 30, 2024 and sell it today you would earn a total of 117.00 from holding Century Casinos or generate 35.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Century Casinos vs. MGM Resorts International
Performance |
| Timeline |
| Century Casinos |
| MGM Resorts International |
Century Casinos and MGM Resorts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Casinos and MGM Resorts
The main advantage of trading using opposite Century Casinos and MGM Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Casinos 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.| Century Casinos vs. Golden Entertainment | Century Casinos vs. Monarch Casino Resort | Century Casinos vs. Red Rock Resorts | Century Casinos vs. Studio City International |
| MGM Resorts vs. Wynn Resorts Limited | MGM Resorts vs. Caesars Entertainment | MGM Resorts vs. Melco Resorts Entertainment | MGM Resorts vs. Penn National Gaming |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |