Correlation Between Rush Street and Aurum Resources
Can any of the company-specific risk be diversified away by investing in both Rush Street and Aurum Resources 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 Aurum Resources 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 Aurum Resources, you can compare the effects of market volatilities on Rush Street and Aurum Resources 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 Aurum Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Aurum Resources.
Diversification Opportunities for Rush Street and Aurum Resources
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and Aurum is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Aurum Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurum Resources 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 Aurum Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurum Resources has no effect on the direction of Rush Street i.e., Rush Street and Aurum Resources go up and down completely randomly.
Pair Corralation between Rush Street and Aurum Resources
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 0.69 times more return on investment than Aurum Resources. However, Rush Street Interactive is 1.45 times less risky than Aurum Resources. It trades about 0.12 of its potential returns per unit of risk. Aurum Resources is currently generating about 0.03 per unit of risk. If you would invest 880.00 in Rush Street Interactive on August 26, 2024 and sell it today you would earn a total of 452.00 from holding Rush Street Interactive or generate 51.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.45% |
| Values | Daily Returns |
Rush Street Interactive vs. Aurum Resources
Performance |
| Timeline |
| Rush Street Interactive |
| Aurum Resources |
Rush Street and Aurum Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Aurum Resources
The main advantage of trading using opposite Rush Street and Aurum Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Aurum Resources 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 Aurum Resources will offset losses from the drop in Aurum Resources' long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Aurum Resources vs. ARN Media Limited | Aurum Resources vs. Pioneer Credit | Aurum Resources vs. BSP Financial Group | Aurum Resources vs. Skycity Entertainment Group |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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