Correlation Between Rush Street and Natera
Can any of the company-specific risk be diversified away by investing in both Rush Street and Natera 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 Natera 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 Natera Inc, you can compare the effects of market volatilities on Rush Street and Natera 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 Natera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Natera.
Diversification Opportunities for Rush Street and Natera
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and Natera is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Natera Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natera Inc 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 Natera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natera Inc has no effect on the direction of Rush Street i.e., Rush Street and Natera go up and down completely randomly.
Pair Corralation between Rush Street and Natera
Considering the 90-day investment horizon Rush Street is expected to generate 1.02 times less return on investment than Natera. In addition to that, Rush Street is 1.18 times more volatile than Natera Inc. It trades about 0.09 of its total potential returns per unit of risk. Natera Inc is currently generating about 0.11 per unit of volatility. If you would invest 4,039 in Natera Inc on August 24, 2024 and sell it today you would earn a total of 12,687 from holding Natera Inc or generate 314.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Natera Inc
Performance |
| Timeline |
| Rush Street Interactive |
| Natera Inc |
Rush Street and Natera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Natera
The main advantage of trading using opposite Rush Street and Natera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Natera 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 Natera will offset losses from the drop in Natera's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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