Correlation Between MGM Resorts and Genting Singapore
Can any of the company-specific risk be diversified away by investing in both MGM Resorts and Genting Singapore 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 MGM Resorts and Genting Singapore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGM Resorts International and Genting Singapore PLC, you can compare the effects of market volatilities on MGM Resorts and Genting Singapore 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 MGM Resorts with a short position of Genting Singapore. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGM Resorts and Genting Singapore.
Diversification Opportunities for MGM Resorts and Genting Singapore
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MGM and Genting is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding MGM Resorts International and Genting Singapore PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genting Singapore PLC and MGM Resorts 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 MGM Resorts International are associated (or correlated) with Genting Singapore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genting Singapore PLC has no effect on the direction of MGM Resorts i.e., MGM Resorts and Genting Singapore go up and down completely randomly.
Pair Corralation between MGM Resorts and Genting Singapore
Considering the 90-day investment horizon MGM Resorts International is expected to generate 0.37 times more return on investment than Genting Singapore. However, MGM Resorts International is 2.72 times less risky than Genting Singapore. It trades about 0.03 of its potential returns per unit of risk. Genting Singapore PLC is currently generating about -0.06 per unit of risk. If you would invest 3,672 in MGM Resorts International on September 12, 2024 and sell it today you would earn a total of 22.00 from holding MGM Resorts International or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
MGM Resorts International vs. Genting Singapore PLC
Performance |
| Timeline |
| MGM Resorts International |
| Genting Singapore PLC |
MGM Resorts and Genting Singapore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGM Resorts and Genting Singapore
The main advantage of trading using opposite MGM Resorts and Genting Singapore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGM Resorts position performs unexpectedly, Genting Singapore 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 Genting Singapore will offset losses from the drop in Genting Singapore's long position.| MGM Resorts vs. Wynn Resorts Limited | MGM Resorts vs. Caesars Entertainment | MGM Resorts vs. Melco Resorts Entertainment | MGM Resorts vs. Penn National Gaming |
| Genting Singapore vs. Omni Health | Genting Singapore vs. Kontoor Brands | Genting Singapore vs. Lipocine | Genting Singapore vs. Nike Inc |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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