Correlation Between Rush Street and Magellan Gold
Can any of the company-specific risk be diversified away by investing in both Rush Street and Magellan Gold 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 Magellan Gold 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 Magellan Gold Corp, you can compare the effects of market volatilities on Rush Street and Magellan Gold 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 Magellan Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Magellan Gold.
Diversification Opportunities for Rush Street and Magellan Gold
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rush and Magellan is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Magellan Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magellan Gold Corp 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 Magellan Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magellan Gold Corp has no effect on the direction of Rush Street i.e., Rush Street and Magellan Gold go up and down completely randomly.
Pair Corralation between Rush Street and Magellan Gold
Considering the 90-day investment horizon Rush Street is expected to generate 1.25 times less return on investment than Magellan Gold. But when comparing it to its historical volatility, Rush Street Interactive is 3.51 times less risky than Magellan Gold. It trades about 0.13 of its potential returns per unit of risk. Magellan Gold Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Magellan Gold Corp on September 1, 2024 and sell it today you would lose (6.00) from holding Magellan Gold Corp or give up 40.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Rush Street Interactive vs. Magellan Gold Corp
Performance |
| Timeline |
| Rush Street Interactive |
| Magellan Gold Corp |
Rush Street and Magellan Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Magellan Gold
The main advantage of trading using opposite Rush Street and Magellan Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Magellan Gold 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 Magellan Gold will offset losses from the drop in Magellan Gold's long position.| Rush Street vs. Yum Brands | Rush Street vs. The Wendys Co | Rush Street vs. Wingstop | Rush Street vs. Shake Shack |
| Magellan Gold vs. Vortex Metals | Magellan Gold vs. Compania de Minas | Magellan Gold vs. American Copper Development | Magellan Gold vs. Triple Flag Precious |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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