Correlation Between Rush Street and Sto SE
Can any of the company-specific risk be diversified away by investing in both Rush Street and Sto SE 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 Sto SE 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 Sto SE Co, you can compare the effects of market volatilities on Rush Street and Sto SE 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 Sto SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and Sto SE.
Diversification Opportunities for Rush Street and Sto SE
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rush and Sto is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and Sto SE Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sto SE 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 Sto SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sto SE has no effect on the direction of Rush Street i.e., Rush Street and Sto SE go up and down completely randomly.
Pair Corralation between Rush Street and Sto SE
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 1.91 times more return on investment than Sto SE. However, Rush Street is 1.91 times more volatile than Sto SE Co. It trades about 0.12 of its potential returns per unit of risk. Sto SE Co is currently generating about -0.05 per unit of risk. If you would invest 320.00 in Rush Street Interactive on August 27, 2024 and sell it today you would earn a total of 1,012 from holding Rush Street Interactive or generate 316.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.16% |
| Values | Daily Returns |
Rush Street Interactive vs. Sto SE Co
Performance |
| Timeline |
| Rush Street Interactive |
| Sto SE |
Rush Street and Sto SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and Sto SE
The main advantage of trading using opposite Rush Street and Sto SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, Sto SE 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 Sto SE will offset losses from the drop in Sto SE's long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| Sto SE vs. RETAIL FOOD GROUP | Sto SE vs. CANON MARKETING JP | Sto SE vs. FLOW TRADERS LTD | Sto SE vs. Tradeweb Markets |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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