Correlation Between Table Trac and Las Vegas
Can any of the company-specific risk be diversified away by investing in both Table Trac and Las Vegas 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 Las Vegas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Table Trac and Las Vegas Sands, you can compare the effects of market volatilities on Table Trac and Las Vegas 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 Las Vegas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Table Trac and Las Vegas.
Diversification Opportunities for Table Trac and Las Vegas
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Table and Las is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Table Trac and Las Vegas Sands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Las Vegas Sands 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 Las Vegas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Las Vegas Sands has no effect on the direction of Table Trac i.e., Table Trac and Las Vegas go up and down completely randomly.
Pair Corralation between Table Trac and Las Vegas
Given the investment horizon of 90 days Table Trac is expected to generate 2.24 times more return on investment than Las Vegas. However, Table Trac is 2.24 times more volatile than Las Vegas Sands. It trades about 0.05 of its potential returns per unit of risk. Las Vegas Sands is currently generating about 0.09 per unit of risk. If you would invest 391.00 in Table Trac on September 1, 2024 and sell it today you would earn a total of 9.00 from holding Table Trac or generate 2.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Table Trac vs. Las Vegas Sands
Performance |
| Timeline |
| Table Trac |
| Las Vegas Sands |
Table Trac and Las Vegas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Table Trac and Las Vegas
The main advantage of trading using opposite Table Trac and Las Vegas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Table Trac position performs unexpectedly, Las Vegas 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 Las Vegas will offset losses from the drop in Las Vegas' long position.| Table Trac vs. Las Vegas Sands | Table Trac vs. MGM Resorts International | Table Trac vs. Caesars Entertainment | Table Trac vs. Wynn Resorts Limited |
| Las Vegas vs. The Wendys Co | Las Vegas vs. Shake Shack | Las Vegas vs. Papa Johns International | Las Vegas vs. Darden Restaurants |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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