Correlation Between Rush Street and Industrial Bank
Can any of the company-specific risk be diversified away by investing in both Rush Street and Industrial Bank 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 Industrial Bank 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 Industrial Bank, you can compare the effects of market volatilities on Rush Street and Industrial Bank 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 Industrial Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Industrial Bank.
Diversification Opportunities for Rush Street and Industrial Bank
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Rush and Industrial is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Industrial Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Bank 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 Industrial Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Bank has no effect on the direction of Rush Street i.e., Rush Street and Industrial Bank go up and down completely randomly.
Pair Corralation between Rush Street and Industrial Bank
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 3.87 times more return on investment than Industrial Bank. However, Rush Street is 3.87 times more volatile than Industrial Bank. It trades about 0.41 of its potential returns per unit of risk. Industrial Bank is currently generating about 0.06 per unit of risk. If you would invest 1,040 in Rush Street Interactive on August 29, 2024 and sell it today you would earn a total of 411.00 from holding Rush Street Interactive or generate 39.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Industrial Bank
Performance |
| Timeline |
| Rush Street Interactive |
| Industrial Bank |
Rush Street and Industrial Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Industrial Bank
The main advantage of trading using opposite Rush Street and Industrial Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Industrial Bank 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 Industrial Bank will offset losses from the drop in Industrial Bank's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Industrial Bank vs. Shinhan Inverse Copper | Industrial Bank vs. Insung Information Co | Industrial Bank vs. Bohae Brewery | Industrial Bank vs. Shinsegae Information Communication |
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 CEOs Directory module to screen CEOs from public companies around the world.
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