Correlation Between Rush Street and Applied Digital
Can any of the company-specific risk be diversified away by investing in both Rush Street and Applied Digital 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 Applied Digital 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 Applied Digital, you can compare the effects of market volatilities on Rush Street and Applied Digital 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 Applied Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Applied Digital.
Diversification Opportunities for Rush Street and Applied Digital
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and Applied is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Applied Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Applied Digital 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 Applied Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Applied Digital has no effect on the direction of Rush Street i.e., Rush Street and Applied Digital go up and down completely randomly.
Pair Corralation between Rush Street and Applied Digital
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 0.47 times more return on investment than Applied Digital. However, Rush Street Interactive is 2.13 times less risky than Applied Digital. It trades about 0.09 of its potential returns per unit of risk. Applied Digital is currently generating about 0.03 per unit of risk. If you would invest 399.00 in Rush Street Interactive on January 10, 2025 and sell it today you would earn a total of 763.00 from holding Rush Street Interactive or generate 191.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Applied Digital
Performance |
| Timeline |
| Rush Street Interactive |
| Applied Digital |
Rush Street and Applied Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Applied Digital
The main advantage of trading using opposite Rush Street and Applied Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Applied Digital 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 Applied Digital will offset losses from the drop in Applied Digital's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Applied Digital vs. Magic Empire Global | Applied Digital vs. Zhong Yang Financial | Applied Digital vs. Netcapital | Applied Digital vs. Lazard |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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