Correlation Between Service Properties and Gaming
Can any of the company-specific risk be diversified away by investing in both Service Properties and Gaming 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 Service Properties and Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Service Properties Trust and Gaming and Leisure, you can compare the effects of market volatilities on Service Properties and Gaming 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 Service Properties with a short position of Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Service Properties and Gaming.
Diversification Opportunities for Service Properties and Gaming
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Service and Gaming is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Service Properties Trust and Gaming and Leisure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaming and Leisure and Service Properties 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 Service Properties Trust are associated (or correlated) with Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaming and Leisure has no effect on the direction of Service Properties i.e., Service Properties and Gaming go up and down completely randomly.
Pair Corralation between Service Properties and Gaming
Assuming the 90 days horizon Service Properties Trust is expected to under-perform the Gaming. In addition to that, Service Properties is 2.52 times more volatile than Gaming and Leisure. It trades about -0.05 of its total potential returns per unit of risk. Gaming and Leisure is currently generating about 0.02 per unit of volatility. If you would invest 4,352 in Gaming and Leisure on October 25, 2024 and sell it today you would earn a total of 350.00 from holding Gaming and Leisure or generate 8.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Service Properties Trust vs. Gaming and Leisure
Performance |
| Timeline |
| Service Properties Trust |
| Gaming and Leisure |
Service Properties and Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Service Properties and Gaming
The main advantage of trading using opposite Service Properties and Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Service Properties position performs unexpectedly, Gaming 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 Gaming will offset losses from the drop in Gaming's long position.| Service Properties vs. Insteel Industries | Service Properties vs. DEVRY EDUCATION GRP | Service Properties vs. STEEL DYNAMICS | Service Properties vs. American Public Education |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |