Correlation Between Rush Street and OMRON
Can any of the company-specific risk be diversified away by investing in both Rush Street and OMRON 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 OMRON 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 OMRON, you can compare the effects of market volatilities on Rush Street and OMRON 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 OMRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and OMRON.
Diversification Opportunities for Rush Street and OMRON
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rush and OMRON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and OMRON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OMRON 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 OMRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OMRON has no effect on the direction of Rush Street i.e., Rush Street and OMRON go up and down completely randomly.
Pair Corralation between Rush Street and OMRON
Considering the 90-day investment horizon Rush Street is expected to generate 3.29 times less return on investment than OMRON. But when comparing it to its historical volatility, Rush Street Interactive is 11.91 times less risky than OMRON. It trades about 0.09 of its potential returns per unit of risk. OMRON is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,136 in OMRON on August 30, 2024 and sell it today you would lose (1,762) from holding OMRON or give up 34.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 88.91% |
| Values | Daily Returns |
Rush Street Interactive vs. OMRON
Performance |
| Timeline |
| Rush Street Interactive |
| OMRON |
Rush Street and OMRON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and OMRON
The main advantage of trading using opposite Rush Street and OMRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, OMRON 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 OMRON will offset losses from the drop in OMRON'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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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