Correlation Between Rush Street and Municipal Bond
Can any of the company-specific risk be diversified away by investing in both Rush Street and Municipal Bond 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 Municipal Bond 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 Municipal Bond Portfolio, you can compare the effects of market volatilities on Rush Street and Municipal Bond 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 Municipal Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Municipal Bond.
Diversification Opportunities for Rush Street and Municipal Bond
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rush and Municipal is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Municipal Bond Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Municipal Bond Portfolio 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 Municipal Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Municipal Bond Portfolio has no effect on the direction of Rush Street i.e., Rush Street and Municipal Bond go up and down completely randomly.
Pair Corralation between Rush Street and Municipal Bond
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 16.78 times more return on investment than Municipal Bond. However, Rush Street is 16.78 times more volatile than Municipal Bond Portfolio. It trades about 0.36 of its potential returns per unit of risk. Municipal Bond Portfolio is currently generating about 0.21 per unit of risk. If you would invest 1,082 in Rush Street Interactive on September 1, 2024 and sell it today you would earn a total of 360.00 from holding Rush Street Interactive or generate 33.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Rush Street Interactive vs. Municipal Bond Portfolio
Performance |
| Timeline |
| Rush Street Interactive |
| Municipal Bond Portfolio |
Rush Street and Municipal Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Municipal Bond
The main advantage of trading using opposite Rush Street and Municipal Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Municipal Bond 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 Municipal Bond will offset losses from the drop in Municipal Bond's long position.| Rush Street vs. The Wendys Co | Rush Street vs. Shake Shack | Rush Street vs. Papa Johns International | Rush Street vs. Darden Restaurants |
| Municipal Bond vs. Artisan High Income | Municipal Bond vs. T Rowe Price | Municipal Bond vs. Lgm Risk Managed | Municipal Bond vs. Legg Mason Partners |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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