Correlation Between Penn National and QINGCI GAMES
Can any of the company-specific risk be diversified away by investing in both Penn National and QINGCI GAMES 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 National and QINGCI GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Penn National Gaming and QINGCI GAMES INC, you can compare the effects of market volatilities on Penn National and QINGCI GAMES 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 National with a short position of QINGCI GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penn National and QINGCI GAMES.
Diversification Opportunities for Penn National and QINGCI GAMES
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Penn and QINGCI is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Penn National Gaming and QINGCI GAMES INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QINGCI GAMES INC and Penn National 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 National Gaming are associated (or correlated) with QINGCI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QINGCI GAMES INC has no effect on the direction of Penn National i.e., Penn National and QINGCI GAMES go up and down completely randomly.
Pair Corralation between Penn National and QINGCI GAMES
Assuming the 90 days horizon Penn National Gaming is expected to generate 0.88 times more return on investment than QINGCI GAMES. However, Penn National Gaming is 1.13 times less risky than QINGCI GAMES. It trades about 0.12 of its potential returns per unit of risk. QINGCI GAMES INC is currently generating about -0.02 per unit of risk. If you would invest 1,660 in Penn National Gaming on September 2, 2024 and sell it today you would earn a total of 324.00 from holding Penn National Gaming or generate 19.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penn National Gaming vs. QINGCI GAMES INC
Performance |
| Timeline |
| Penn National Gaming |
| QINGCI GAMES INC |
Penn National and QINGCI GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penn National and QINGCI GAMES
The main advantage of trading using opposite Penn National and QINGCI GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penn National position performs unexpectedly, QINGCI GAMES 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 QINGCI GAMES will offset losses from the drop in QINGCI GAMES's long position.| Penn National vs. Superior Plus Corp | Penn National vs. NMI Holdings | Penn National vs. Origin Agritech | Penn National vs. SIVERS SEMICONDUCTORS AB |
| QINGCI GAMES vs. Nintendo Co | QINGCI GAMES vs. Sea Limited | QINGCI GAMES vs. Superior Plus Corp | QINGCI GAMES vs. NMI 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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