Correlation Between PENN NATL and SANOK RUBBER
Can any of the company-specific risk be diversified away by investing in both PENN NATL and SANOK RUBBER 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 PENN NATL and SANOK RUBBER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PENN NATL GAMING and SANOK RUBBER ZY, you can compare the effects of market volatilities on PENN NATL and SANOK RUBBER 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 PENN NATL with a short position of SANOK RUBBER. Check out your portfolio center. Please also check ongoing floating volatility patterns of PENN NATL and SANOK RUBBER.
Diversification Opportunities for PENN NATL and SANOK RUBBER
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PENN and SANOK is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding PENN NATL GAMING and SANOK RUBBER ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANOK RUBBER ZY and PENN NATL 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 PENN NATL GAMING are associated (or correlated) with SANOK RUBBER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANOK RUBBER ZY has no effect on the direction of PENN NATL i.e., PENN NATL and SANOK RUBBER go up and down completely randomly.
Pair Corralation between PENN NATL and SANOK RUBBER
Assuming the 90 days trading horizon PENN NATL GAMING is expected to under-perform the SANOK RUBBER. In addition to that, PENN NATL is 1.78 times more volatile than SANOK RUBBER ZY. It trades about -0.03 of its total potential returns per unit of risk. SANOK RUBBER ZY is currently generating about 0.39 per unit of volatility. If you would invest 451.00 in SANOK RUBBER ZY on October 11, 2024 and sell it today you would earn a total of 60.00 from holding SANOK RUBBER ZY or generate 13.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PENN NATL GAMING vs. SANOK RUBBER ZY
Performance |
| Timeline |
| PENN NATL GAMING |
| SANOK RUBBER ZY |
PENN NATL and SANOK RUBBER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PENN NATL and SANOK RUBBER
The main advantage of trading using opposite PENN NATL and SANOK RUBBER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PENN NATL position performs unexpectedly, SANOK RUBBER 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 SANOK RUBBER will offset losses from the drop in SANOK RUBBER's long position.| PENN NATL vs. Japan Tobacco | PENN NATL vs. ENVVENO MEDICAL DL 00001 | PENN NATL vs. CompuGroup Medical SE | PENN NATL vs. JAPAN TOBACCO UNSPADR12 |
| SANOK RUBBER vs. TERADATA | SANOK RUBBER vs. Uber Technologies | SANOK RUBBER vs. Cass Information Systems | SANOK RUBBER vs. ASPEN TECHINC DL |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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