Correlation Between DATAGROUP and PENN Entertainment
Can any of the company-specific risk be diversified away by investing in both DATAGROUP and PENN Entertainment 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 DATAGROUP and PENN Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DATAGROUP SE and PENN Entertainment, you can compare the effects of market volatilities on DATAGROUP and PENN Entertainment 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 DATAGROUP with a short position of PENN Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of DATAGROUP and PENN Entertainment.
Diversification Opportunities for DATAGROUP and PENN Entertainment
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between DATAGROUP and PENN is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding DATAGROUP SE and PENN Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PENN Entertainment and DATAGROUP 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 DATAGROUP SE are associated (or correlated) with PENN Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PENN Entertainment has no effect on the direction of DATAGROUP i.e., DATAGROUP and PENN Entertainment go up and down completely randomly.
Pair Corralation between DATAGROUP and PENN Entertainment
Assuming the 90 days trading horizon DATAGROUP is expected to generate 9.06 times less return on investment than PENN Entertainment. But when comparing it to its historical volatility, DATAGROUP SE is 1.69 times less risky than PENN Entertainment. It trades about 0.01 of its potential returns per unit of risk. PENN Entertainment is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,876 in PENN Entertainment on October 19, 2024 and sell it today you would earn a total of 46.00 from holding PENN Entertainment or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DATAGROUP SE vs. PENN Entertainment
Performance |
| Timeline |
| DATAGROUP SE |
| PENN Entertainment |
DATAGROUP and PENN Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DATAGROUP and PENN Entertainment
The main advantage of trading using opposite DATAGROUP and PENN Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DATAGROUP position performs unexpectedly, PENN Entertainment 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 Entertainment will offset losses from the drop in PENN Entertainment's long position.| DATAGROUP vs. MEDICAL FACILITIES NEW | DATAGROUP vs. US Physical Therapy | DATAGROUP vs. PEPTONIC MEDICAL | DATAGROUP vs. ONWARD MEDICAL BV |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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