Correlation Between Rush Street and Themes Small
Can any of the company-specific risk be diversified away by investing in both Rush Street and Themes Small 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 Themes Small 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 Themes Small Cap, you can compare the effects of market volatilities on Rush Street and Themes Small 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 Themes Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Themes Small.
Diversification Opportunities for Rush Street and Themes Small
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and Themes is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Themes Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Themes Small Cap 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 Themes Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Themes Small Cap has no effect on the direction of Rush Street i.e., Rush Street and Themes Small go up and down completely randomly.
Pair Corralation between Rush Street and Themes Small
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 2.68 times more return on investment than Themes Small. However, Rush Street is 2.68 times more volatile than Themes Small Cap. It trades about 0.36 of its potential returns per unit of risk. Themes Small Cap is currently generating about 0.33 per unit of risk. If you would invest 1,061 in Rush Street Interactive on August 30, 2024 and sell it today you would earn a total of 360.00 from holding Rush Street Interactive or generate 33.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Rush Street Interactive vs. Themes Small Cap
Performance |
| Timeline |
| Rush Street Interactive |
| Themes Small Cap |
Rush Street and Themes Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Themes Small
The main advantage of trading using opposite Rush Street and Themes Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Themes Small 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 Themes Small will offset losses from the drop in Themes Small's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Themes Small vs. Dimensional ETF Trust | Themes Small vs. Vanguard Small Cap Index | Themes Small vs. First Trust Multi Manager | Themes Small vs. Vanguard SP Small Cap |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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