Correlation Between Rush Street and IShares Core
Can any of the company-specific risk be diversified away by investing in both Rush Street and IShares Core 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 IShares Core 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 iShares Core SP, you can compare the effects of market volatilities on Rush Street and IShares Core 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 IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and IShares Core.
Diversification Opportunities for Rush Street and IShares Core
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rush and IShares is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive and iShares Core SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core SP 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 IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core SP has no effect on the direction of Rush Street i.e., Rush Street and IShares Core go up and down completely randomly.
Pair Corralation between Rush Street and IShares Core
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 5.53 times more return on investment than IShares Core. However, Rush Street is 5.53 times more volatile than iShares Core SP. It trades about 0.36 of its potential returns per unit of risk. iShares Core SP is currently generating about 0.36 per unit of risk. If you would invest 1,082 in Rush Street Interactive on September 1, 2024 and sell it today you would earn a total of 360.00 from holding Rush Street Interactive or generate 33.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Rush Street Interactive vs. iShares Core SP
Performance |
| Timeline |
| Rush Street Interactive |
| iShares Core SP |
Rush Street and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and IShares Core
The main advantage of trading using opposite Rush Street and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street position performs unexpectedly, IShares Core 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 IShares Core will offset losses from the drop in IShares Core's long position.| Rush Street vs. Yum Brands | Rush Street vs. The Wendys Co | Rush Street vs. Wingstop | Rush Street vs. Shake Shack |
| IShares Core vs. iShares SPTSX 60 | IShares Core vs. iShares MSCI EAFE | IShares Core vs. iShares Core SPTSX | IShares Core vs. iShares SPTSX Capped |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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