Correlation Between Rush Street and Baird Midcap
Can any of the company-specific risk be diversified away by investing in both Rush Street and Baird Midcap 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 Baird Midcap 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 Baird Midcap Fund, you can compare the effects of market volatilities on Rush Street and Baird Midcap 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 Baird Midcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Baird Midcap.
Diversification Opportunities for Rush Street and Baird Midcap
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rush and Baird is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Baird Midcap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baird Midcap 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 Baird Midcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baird Midcap has no effect on the direction of Rush Street i.e., Rush Street and Baird Midcap go up and down completely randomly.
Pair Corralation between Rush Street and Baird Midcap
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 3.7 times more return on investment than Baird Midcap. However, Rush Street is 3.7 times more volatile than Baird Midcap Fund. It trades about 0.4 of its potential returns per unit of risk. Baird Midcap Fund is currently generating about 0.26 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 | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Baird Midcap Fund
Performance |
| Timeline |
| Rush Street Interactive |
| Baird Midcap |
Rush Street and Baird Midcap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Baird Midcap
The main advantage of trading using opposite Rush Street and Baird Midcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Baird Midcap 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 Baird Midcap will offset losses from the drop in Baird Midcap's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Baird Midcap vs. Alger Health Sciences | Baird Midcap vs. The Gabelli Healthcare | Baird Midcap vs. Baillie Gifford Health | Baird Midcap vs. Eventide Healthcare Life |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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