Correlation Between Golden Entertainment and Studio City
Can any of the company-specific risk be diversified away by investing in both Golden Entertainment and Studio City 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 Golden Entertainment and Studio City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Entertainment and Studio City International, you can compare the effects of market volatilities on Golden Entertainment and Studio City 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 Golden Entertainment with a short position of Studio City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Entertainment and Studio City.
Diversification Opportunities for Golden Entertainment and Studio City
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Golden and Studio is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Golden Entertainment and Studio City International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Studio City International and Golden 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 Golden Entertainment are associated (or correlated) with Studio City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Studio City International has no effect on the direction of Golden Entertainment i.e., Golden Entertainment and Studio City go up and down completely randomly.
Pair Corralation between Golden Entertainment and Studio City
Given the investment horizon of 90 days Golden Entertainment is expected to under-perform the Studio City. But the stock apears to be less risky and, when comparing its historical volatility, Golden Entertainment is 2.42 times less risky than Studio City. The stock trades about 0.0 of its potential returns per unit of risk. The Studio City International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 329.00 in Studio City International on August 24, 2024 and sell it today you would earn a total of 371.00 from holding Studio City International or generate 112.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Golden Entertainment vs. Studio City International
Performance |
| Timeline |
| Golden Entertainment |
| Studio City International |
Golden Entertainment and Studio City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Entertainment and Studio City
The main advantage of trading using opposite Golden Entertainment and Studio City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Entertainment position performs unexpectedly, Studio City 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 Studio City will offset losses from the drop in Studio City's long position.| Golden Entertainment vs. Red Rock Resorts | Golden Entertainment vs. Century Casinos | Golden Entertainment vs. Studio City International | Golden Entertainment vs. Ballys Corp |
| Studio City vs. Golden Entertainment | Studio City vs. Red Rock Resorts | Studio City vs. Century Casinos | Studio City 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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