Correlation Between Rush Street and American Funds
Can any of the company-specific risk be diversified away by investing in both Rush Street and American Funds 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 American Funds 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 American Funds New, you can compare the effects of market volatilities on Rush Street and American Funds 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 American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and American Funds.
Diversification Opportunities for Rush Street and American Funds
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Rush and American is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and American Funds New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds New 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 American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds New has no effect on the direction of Rush Street i.e., Rush Street and American Funds go up and down completely randomly.
Pair Corralation between Rush Street and American Funds
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 4.18 times more return on investment than American Funds. However, Rush Street is 4.18 times more volatile than American Funds New. It trades about 0.13 of its potential returns per unit of risk. American Funds New is currently generating about 0.08 per unit of risk. If you would invest 305.00 in Rush Street Interactive on August 31, 2024 and sell it today you would earn a total of 1,137 from holding Rush Street Interactive or generate 372.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Rush Street Interactive vs. American Funds New
Performance |
| Timeline |
| Rush Street Interactive |
| American Funds New |
Rush Street and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and American Funds
The main advantage of trading using opposite Rush Street and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| American Funds vs. American Funds New | American Funds vs. New Perspective Fund | American Funds vs. New Perspective Fund | American Funds vs. New Perspective Fund |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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