Correlation Between Everi Holdings and Groupon
Can any of the company-specific risk be diversified away by investing in both Everi Holdings and Groupon 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 Everi Holdings and Groupon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Everi Holdings and Groupon, you can compare the effects of market volatilities on Everi Holdings and Groupon 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 Everi Holdings with a short position of Groupon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Everi Holdings and Groupon.
Diversification Opportunities for Everi Holdings and Groupon
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Everi and Groupon is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Everi Holdings and Groupon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groupon and Everi Holdings 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 Everi Holdings are associated (or correlated) with Groupon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groupon has no effect on the direction of Everi Holdings i.e., Everi Holdings and Groupon go up and down completely randomly.
Pair Corralation between Everi Holdings and Groupon
Given the investment horizon of 90 days Everi Holdings is expected to generate 19.89 times less return on investment than Groupon. But when comparing it to its historical volatility, Everi Holdings is 2.11 times less risky than Groupon. It trades about 0.0 of its potential returns per unit of risk. Groupon is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 719.00 in Groupon on September 3, 2024 and sell it today you would earn a total of 219.00 from holding Groupon or generate 30.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Everi Holdings vs. Groupon
Performance |
| Timeline |
| Everi Holdings |
| Groupon |
Everi Holdings and Groupon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Everi Holdings and Groupon
The main advantage of trading using opposite Everi Holdings and Groupon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Everi Holdings position performs unexpectedly, Groupon 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 Groupon will offset losses from the drop in Groupon's long position.| Everi Holdings vs. Accel Entertainment | Everi Holdings vs. Light Wonder | Everi Holdings vs. Inspired Entertainment | Everi Holdings 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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