Correlation Between Rush Street and Sonder Holdings
Can any of the company-specific risk be diversified away by investing in both Rush Street and Sonder Holdings 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 Sonder Holdings 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 Sonder Holdings, you can compare the effects of market volatilities on Rush Street and Sonder Holdings 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 Sonder Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Sonder Holdings.
Diversification Opportunities for Rush Street and Sonder Holdings
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rush and Sonder is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Sonder Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonder Holdings 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 Sonder Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonder Holdings has no effect on the direction of Rush Street i.e., Rush Street and Sonder Holdings go up and down completely randomly.
Pair Corralation between Rush Street and Sonder Holdings
Considering the 90-day investment horizon Rush Street is expected to generate 2.11 times less return on investment than Sonder Holdings. But when comparing it to its historical volatility, Rush Street Interactive is 5.15 times less risky than Sonder Holdings. It trades about 0.15 of its potential returns per unit of risk. Sonder Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 357.00 in Sonder Holdings on September 1, 2024 and sell it today you would earn a total of 16.00 from holding Sonder Holdings or generate 4.48% 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. Sonder Holdings
Performance |
| Timeline |
| Rush Street Interactive |
| Sonder Holdings |
Rush Street and Sonder Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Sonder Holdings
The main advantage of trading using opposite Rush Street and Sonder Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Sonder Holdings 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 Sonder Holdings will offset losses from the drop in Sonder Holdings' long position.| Rush Street vs. The Wendys Co | Rush Street vs. Shake Shack | Rush Street vs. Papa Johns International | Rush Street vs. Darden Restaurants |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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