Correlation Between Gambling and Red Rock
Can any of the company-specific risk be diversified away by investing in both Gambling and Red Rock 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 Gambling and Red Rock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gambling Group and Red Rock Resorts, you can compare the effects of market volatilities on Gambling and Red Rock 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 Gambling with a short position of Red Rock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gambling and Red Rock.
Diversification Opportunities for Gambling and Red Rock
Excellent diversification
The 3 months correlation between Gambling and Red is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gambling Group and Red Rock Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Red Rock Resorts and Gambling 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 Gambling Group are associated (or correlated) with Red Rock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Red Rock Resorts has no effect on the direction of Gambling i.e., Gambling and Red Rock go up and down completely randomly.
Pair Corralation between Gambling and Red Rock
Given the investment horizon of 90 days Gambling Group is expected to generate 1.33 times more return on investment than Red Rock. However, Gambling is 1.33 times more volatile than Red Rock Resorts. It trades about 0.04 of its potential returns per unit of risk. Red Rock Resorts is currently generating about 0.03 per unit of risk. If you would invest 900.00 in Gambling Group on September 4, 2024 and sell it today you would earn a total of 436.00 from holding Gambling Group or generate 48.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gambling Group vs. Red Rock Resorts
Performance |
| Timeline |
| Gambling Group |
| Red Rock Resorts |
Gambling and Red Rock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gambling and Red Rock
The main advantage of trading using opposite Gambling and Red Rock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gambling position performs unexpectedly, Red Rock 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 Red Rock will offset losses from the drop in Red Rock's long position.| Gambling vs. Codere Online Corp | Gambling vs. Accel Entertainment | Gambling vs. PlayAGS | Gambling vs. Canterbury Park Holding |
| Red Rock vs. Golden Entertainment | Red Rock vs. Century Casinos | Red Rock vs. Studio City International | Red Rock vs. Ballys Corp |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |