Correlation Between Rush Street and Next PLC
Can any of the company-specific risk be diversified away by investing in both Rush Street and Next PLC 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 Next PLC 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 Next PLC, you can compare the effects of market volatilities on Rush Street and Next PLC 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 Next PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Next PLC.
Diversification Opportunities for Rush Street and Next PLC
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rush and Next is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Next PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Next PLC 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 Next PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Next PLC has no effect on the direction of Rush Street i.e., Rush Street and Next PLC go up and down completely randomly.
Pair Corralation between Rush Street and Next PLC
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 2.9 times more return on investment than Next PLC. However, Rush Street is 2.9 times more volatile than Next PLC. It trades about 0.41 of its potential returns per unit of risk. Next PLC is currently generating about -0.1 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 Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Next PLC
Performance |
| Timeline |
| Rush Street Interactive |
| Next PLC |
Rush Street and Next PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Next PLC
The main advantage of trading using opposite Rush Street and Next PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Next PLC 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 Next PLC will offset losses from the drop in Next PLC's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Next PLC vs. Tungsten West PLC | Next PLC vs. Argo Group Limited | Next PLC vs. Hardide PLC | Next PLC vs. Versarien PLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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