Correlation Between Table Trac and Century Casinos
Can any of the company-specific risk be diversified away by investing in both Table Trac and Century Casinos 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 Table Trac and Century Casinos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Table Trac and Century Casinos, you can compare the effects of market volatilities on Table Trac and Century Casinos 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 Table Trac with a short position of Century Casinos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Table Trac and Century Casinos.
Diversification Opportunities for Table Trac and Century Casinos
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Table and Century is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Table Trac and Century Casinos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Casinos and Table Trac 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 Table Trac are associated (or correlated) with Century Casinos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Casinos has no effect on the direction of Table Trac i.e., Table Trac and Century Casinos go up and down completely randomly.
Pair Corralation between Table Trac and Century Casinos
Given the investment horizon of 90 days Table Trac is expected to generate 30.65 times less return on investment than Century Casinos. But when comparing it to its historical volatility, Table Trac is 1.21 times less risky than Century Casinos. It trades about 0.02 of its potential returns per unit of risk. Century Casinos is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 322.00 in Century Casinos on August 29, 2024 and sell it today you would earn a total of 144.00 from holding Century Casinos or generate 44.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Table Trac vs. Century Casinos
Performance |
| Timeline |
| Table Trac |
| Century Casinos |
Table Trac and Century Casinos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Table Trac and Century Casinos
The main advantage of trading using opposite Table Trac and Century Casinos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Table Trac position performs unexpectedly, Century Casinos 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 Century Casinos will offset losses from the drop in Century Casinos' long position.| Table Trac vs. Studio City International | Table Trac vs. Monarch Casino Resort | Table Trac vs. Playa Hotels Resorts | Table Trac vs. Las Vegas Sands |
| Century Casinos vs. Golden Entertainment | Century Casinos vs. Monarch Casino Resort | Century Casinos vs. Red Rock Resorts | Century Casinos vs. Studio City International |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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