Correlation Between Rush Street and Asiana Airlines
Can any of the company-specific risk be diversified away by investing in both Rush Street and Asiana Airlines 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 Rush Street and Asiana Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rush Street Interactive and Asiana Airlines, you can compare the effects of market volatilities on Rush Street and Asiana Airlines 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 Rush Street with a short position of Asiana Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Asiana Airlines.
Diversification Opportunities for Rush Street and Asiana Airlines
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and Asiana is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Asiana Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiana Airlines and Rush Street 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 Rush Street Interactive are associated (or correlated) with Asiana Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiana Airlines has no effect on the direction of Rush Street i.e., Rush Street and Asiana Airlines go up and down completely randomly.
Pair Corralation between Rush Street and Asiana Airlines
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 1.89 times more return on investment than Asiana Airlines. However, Rush Street is 1.89 times more volatile than Asiana Airlines. It trades about 0.36 of its potential returns per unit of risk. Asiana Airlines is currently generating about 0.14 per unit of risk. If you would invest 1,082 in Rush Street Interactive on September 1, 2024 and sell it today you would earn a total of 360.00 from holding Rush Street Interactive or generate 33.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Rush Street Interactive vs. Asiana Airlines
Performance |
| Timeline |
| Rush Street Interactive |
| Asiana Airlines |
Rush Street and Asiana Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Asiana Airlines
The main advantage of trading using opposite Rush Street and Asiana Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Asiana Airlines 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 Asiana Airlines will offset losses from the drop in Asiana Airlines' long position.| Rush Street vs. The Wendys Co | Rush Street vs. Shake Shack | Rush Street vs. Papa Johns International | Rush Street vs. Darden Restaurants |
| Asiana Airlines vs. Barunson Entertainment Arts | Asiana Airlines vs. DC Media Co | Asiana Airlines vs. ChipsMedia | Asiana Airlines vs. SBI Investment KOREA |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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