Correlation Between Rush Street and IQ Merger
Can any of the company-specific risk be diversified away by investing in both Rush Street and IQ Merger 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 IQ Merger 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 IQ Merger Arbitrage, you can compare the effects of market volatilities on Rush Street and IQ Merger 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 IQ Merger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and IQ Merger.
Diversification Opportunities for Rush Street and IQ Merger
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Rush and MNA is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and IQ Merger Arbitrage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ Merger Arbitrage 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 IQ Merger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ Merger Arbitrage has no effect on the direction of Rush Street i.e., Rush Street and IQ Merger go up and down completely randomly.
Pair Corralation between Rush Street and IQ Merger
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 12.65 times more return on investment than IQ Merger. However, Rush Street is 12.65 times more volatile than IQ Merger Arbitrage. It trades about 0.09 of its potential returns per unit of risk. IQ Merger Arbitrage is currently generating about 0.04 per unit of risk. If you would invest 353.00 in Rush Street Interactive on August 28, 2024 and sell it today you would earn a total of 1,098 from holding Rush Street Interactive or generate 311.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. IQ Merger Arbitrage
Performance |
| Timeline |
| Rush Street Interactive |
| IQ Merger Arbitrage |
Rush Street and IQ Merger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and IQ Merger
The main advantage of trading using opposite Rush Street and IQ Merger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, IQ Merger 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 IQ Merger will offset losses from the drop in IQ Merger's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| IQ Merger vs. IQ Hedge Multi Strategy | IQ Merger vs. ProShares Merger ETF | IQ Merger vs. AGFiQ Market Neutral |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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