Correlation Between Rush Street and Federated Strategic
Can any of the company-specific risk be diversified away by investing in both Rush Street and Federated Strategic 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 Federated Strategic 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 Federated Strategic Income, you can compare the effects of market volatilities on Rush Street and Federated Strategic 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 Federated Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Federated Strategic.
Diversification Opportunities for Rush Street and Federated Strategic
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Rush and Federated is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Federated Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Strategic 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 Federated Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Strategic has no effect on the direction of Rush Street i.e., Rush Street and Federated Strategic go up and down completely randomly.
Pair Corralation between Rush Street and Federated Strategic
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 11.5 times more return on investment than Federated Strategic. However, Rush Street is 11.5 times more volatile than Federated Strategic Income. It trades about 0.12 of its potential returns per unit of risk. Federated Strategic Income is currently generating about 0.1 per unit of risk. If you would invest 371.00 in Rush Street Interactive on August 26, 2024 and sell it today you would earn a total of 961.00 from holding Rush Street Interactive or generate 259.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. Federated Strategic Income
Performance |
| Timeline |
| Rush Street Interactive |
| Federated Strategic |
Rush Street and Federated Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Federated Strategic
The main advantage of trading using opposite Rush Street and Federated Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Federated Strategic 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 Federated Strategic will offset losses from the drop in Federated Strategic's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Federated Strategic vs. Federated Emerging Market | Federated Strategic vs. Federated Mdt All | Federated Strategic vs. Federated Mdt Balanced | Federated Strategic vs. Federated Global Allocation |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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