Correlation Between International Game and Carnival
Can any of the company-specific risk be diversified away by investing in both International Game and Carnival 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 International Game and Carnival into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Game Technology and Carnival, you can compare the effects of market volatilities on International Game and Carnival 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 International Game with a short position of Carnival. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Game and Carnival.
Diversification Opportunities for International Game and Carnival
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and Carnival is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding International Game Technology and Carnival in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnival and International Game 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 International Game Technology are associated (or correlated) with Carnival. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnival has no effect on the direction of International Game i.e., International Game and Carnival go up and down completely randomly.
Pair Corralation between International Game and Carnival
Considering the 90-day investment horizon International Game Technology is expected to under-perform the Carnival. But the stock apears to be less risky and, when comparing its historical volatility, International Game Technology is 1.2 times less risky than Carnival. The stock trades about -0.15 of its potential returns per unit of risk. The Carnival is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 2,216 in Carnival on August 31, 2024 and sell it today you would earn a total of 298.00 from holding Carnival or generate 13.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Game Technology vs. Carnival
Performance |
| Timeline |
| International Game |
| Carnival |
International Game and Carnival Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Game and Carnival
The main advantage of trading using opposite International Game and Carnival positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Game position performs unexpectedly, Carnival 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 Carnival will offset losses from the drop in Carnival's long position.| International Game vs. Light Wonder | International Game vs. Everi Holdings | International Game vs. Inspired Entertainment | International Game vs. PlayAGS |
| Carnival vs. Royal Caribbean Cruises | Carnival vs. Airbnb Inc | Carnival vs. Expedia Group | Carnival vs. Booking Holdings |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |