Correlation Between Media and Penn National
Can any of the company-specific risk be diversified away by investing in both Media 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 Media and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media and Games and Penn National Gaming, you can compare the effects of market volatilities on Media 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 Media with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media and Penn National.
Diversification Opportunities for Media and Penn National
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Media and Penn is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Media and Games 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 Media 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 Media and Games 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 Media i.e., Media and Penn National go up and down completely randomly.
Pair Corralation between Media and Penn National
Assuming the 90 days trading horizon Media is expected to generate 18.87 times less return on investment than Penn National. In addition to that, Media is 1.32 times more volatile than Penn National Gaming. It trades about 0.0 of its total potential returns per unit of risk. Penn National Gaming is currently generating about 0.11 per unit of volatility. If you would invest 1,775 in Penn National Gaming on October 29, 2024 and sell it today you would earn a total of 112.00 from holding Penn National Gaming or generate 6.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media and Games vs. Penn National Gaming
Performance |
| Timeline |
| Media and Games |
| Penn National Gaming |
Media and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media and Penn National
The main advantage of trading using opposite Media and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media 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.| Media vs. Cardinal Health | Media vs. Siemens Healthineers AG | Media vs. PURETECH HEALTH PLC | Media vs. Universal Health Realty |
| Penn National vs. Las Vegas Sands | Penn National vs. Galaxy Entertainment Group | Penn National vs. Sands China | Penn National vs. MGM Resorts International |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| 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 | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |