Correlation Between Rush Street and TG Therapeutics
Can any of the company-specific risk be diversified away by investing in both Rush Street and TG Therapeutics 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 TG Therapeutics 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 TG Therapeutics, you can compare the effects of market volatilities on Rush Street and TG Therapeutics 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 TG Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and TG Therapeutics.
Diversification Opportunities for Rush Street and TG Therapeutics
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rush and TGTX is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and TG Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TG Therapeutics 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 TG Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TG Therapeutics has no effect on the direction of Rush Street i.e., Rush Street and TG Therapeutics go up and down completely randomly.
Pair Corralation between Rush Street and TG Therapeutics
Considering the 90-day investment horizon Rush Street is expected to generate 1.3 times less return on investment than TG Therapeutics. But when comparing it to its historical volatility, Rush Street Interactive is 1.47 times less risky than TG Therapeutics. It trades about 0.09 of its potential returns per unit of risk. TG Therapeutics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 831.00 in TG Therapeutics on August 28, 2024 and sell it today you would earn a total of 2,630 from holding TG Therapeutics or generate 316.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. TG Therapeutics
Performance |
| Timeline |
| Rush Street Interactive |
| TG Therapeutics |
Rush Street and TG Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and TG Therapeutics
The main advantage of trading using opposite Rush Street and TG Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, TG Therapeutics 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 TG Therapeutics will offset losses from the drop in TG Therapeutics' long position.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| TG Therapeutics vs. Eliem Therapeutics | TG Therapeutics vs. HCW Biologics | TG Therapeutics vs. Scpharmaceuticals | TG Therapeutics vs. Milestone Pharmaceuticals |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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