Correlation Between Qurate Retail and Penn National
Can any of the company-specific risk be diversified away by investing in both Qurate Retail and Penn National 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 Qurate Retail and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qurate Retail Series and Penn National Gaming, you can compare the effects of market volatilities on Qurate Retail and Penn National 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 Qurate Retail with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qurate Retail and Penn National.
Diversification Opportunities for Qurate Retail and Penn National
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Qurate and Penn is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Qurate Retail Series and Penn National Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penn National Gaming and Qurate Retail 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 Qurate Retail Series are associated (or correlated) with Penn National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penn National Gaming has no effect on the direction of Qurate Retail i.e., Qurate Retail and Penn National go up and down completely randomly.
Pair Corralation between Qurate Retail and Penn National
Assuming the 90 days trading horizon Qurate Retail Series is expected to under-perform the Penn National. In addition to that, Qurate Retail is 2.12 times more volatile than Penn National Gaming. It trades about -0.09 of its total potential returns per unit of risk. Penn National Gaming is currently generating about 0.16 per unit of volatility. If you would invest 1,820 in Penn National Gaming on August 30, 2024 and sell it today you would earn a total of 188.00 from holding Penn National Gaming or generate 10.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qurate Retail Series vs. Penn National Gaming
Performance |
| Timeline |
| Qurate Retail Series |
| Penn National Gaming |
Qurate Retail and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qurate Retail and Penn National
The main advantage of trading using opposite Qurate Retail and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qurate Retail position performs unexpectedly, Penn National 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 Penn National will offset losses from the drop in Penn National's long position.| Qurate Retail vs. Superior Plus Corp | Qurate Retail vs. NMI Holdings | Qurate Retail vs. SIVERS SEMICONDUCTORS AB | Qurate Retail vs. Talanx AG |
| Penn National vs. TRADEGATE | Penn National vs. Salesforce | Penn National vs. Sunstone Hotel Investors | Penn National vs. MIRAMAR HOTEL INV |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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