Churchill Downs Incorporated Stock Volatility
| CHDN Stock | USD 141.83 0.04 0.03% |
As of now, Churchill Stock is very steady. Churchill Downs secures Sharpe Ratio (or Efficiency) of 0.0284, which signifies that the company had a 0.0284% return per unit of risk over the last 3 months. We have found twenty-nine technical indicators for Churchill Downs Incorporated, which you can use to evaluate the volatility of the firm. Please confirm Churchill Downs' Risk Adjusted Performance of 0.0376, downside deviation of 1.23, and Mean Deviation of 1.01 to double-check if the risk estimate we provide is consistent with the expected return of 0.0448%. Key indicators related to Churchill Downs' volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
Churchill Downs Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Churchill daily returns, and it is calculated using variance and standard deviation. We also use Churchill's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Churchill Downs volatility.
Churchill |
ESG Sustainability
While most ESG disclosures are voluntary, Churchill Downs' sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Churchill Downs' managers and investors.Environmental | Governance | Social |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Churchill Downs can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Churchill Downs at lower prices. For example, an investor can purchase Churchill stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Churchill Downs' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against Churchill Stock
Churchill Downs Market Sensitivity And Downside Risk
Churchill Downs' beta coefficient measures the volatility of Churchill stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Churchill stock's returns against your selected market. In other words, Churchill Downs's beta of 1.13 provides an investor with an approximation of how much risk Churchill Downs stock can potentially add to one of your existing portfolios. Churchill Downs Incorporated has relatively low volatility with skewness of 1.81 and kurtosis of 7.67. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Churchill Downs' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Churchill Downs' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Churchill Downs Demand TrendCheck current 90 days Churchill Downs correlation with market (Dow Jones Industrial)Churchill Beta |
Churchill standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 1.58 |
It is essential to understand the difference between upside risk (as represented by Churchill Downs's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Churchill Downs' daily returns or price. Since the actual investment returns on holding a position in churchill stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Churchill Downs.
Churchill Downs Stock Volatility Analysis
Volatility refers to the frequency at which Churchill Downs stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Churchill Downs' price changes. Investors will then calculate the volatility of Churchill Downs' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Churchill Downs' volatility:
Historical Volatility
This type of stock volatility measures Churchill Downs' fluctuations based on previous trends. It's commonly used to predict Churchill Downs' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Churchill Downs' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Churchill Downs' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Churchill Downs Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Churchill Downs Projected Return Density Against Market
Given the investment horizon of 90 days the stock has the beta coefficient of 1.1339 suggesting Churchill Downs Incorporated market returns are highly reactive to returns on the market. As the market goes up or down, Churchill Downs is expected to follow.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Churchill Downs or Hotels, Restaurants & Leisure sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Churchill Downs' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Churchill stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Churchill Downs Incorporated has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial. Predicted Return Density |
| Returns |
What Drives a Churchill Downs Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Churchill Downs Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Churchill Downs is 3519.05. The daily returns are distributed with a variance of 2.49 and standard deviation of 1.58. The mean deviation of Churchill Downs Incorporated is currently at 1.0. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.77
α | Alpha over Dow Jones | -0.08 | |
β | Beta against Dow Jones | 1.13 | |
σ | Overall volatility | 1.58 | |
Ir | Information ratio | -0.04 |
Churchill Downs Stock Return Volatility
Churchill Downs historical daily return volatility represents how much of Churchill Downs stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 1.5766% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.7796% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Churchill Downs Volatility
Volatility is a rate at which the price of Churchill Downs or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Churchill Downs may increase or decrease. In other words, similar to Churchill's beta indicator, it measures the risk of Churchill Downs and helps estimate the fluctuations that may happen in a short period of time. So if prices of Churchill Downs fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Market Cap | 3 B | 3.2 B |
Churchill Downs' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Churchill Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Churchill Downs' price varies over time.
3 ways to utilize Churchill Downs' volatility to invest better
Higher Churchill Downs' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Churchill Downs stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Churchill Downs stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Churchill Downs investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Churchill Downs' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Churchill Downs' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Churchill Downs Investment Opportunity
Churchill Downs Incorporated has a volatility of 1.58 and is 2.03 times more volatile than Dow Jones Industrial. 14 percent of all equities and portfolios are less risky than Churchill Downs. You can use Churchill Downs Incorporated to protect your portfolios against small market fluctuations. The stock experiences a normal downward trend and little activity. Check odds of Churchill Downs to be traded at $140.41 in 90 days.Very weak diversification
The correlation between Churchill Downs Incorporated and DJI is 0.56 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Churchill Downs Incorporated and DJI in the same portfolio, assuming nothing else is changed.
Churchill Downs Additional Risk Indicators
The analysis of Churchill Downs' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Churchill Downs' investment and either accepting that risk or mitigating it. Along with some common measures of Churchill Downs stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0376 | |||
| Market Risk Adjusted Performance | 0.0595 | |||
| Mean Deviation | 1.01 | |||
| Semi Deviation | 1.17 | |||
| Downside Deviation | 1.23 | |||
| Coefficient Of Variation | 2357.3 | |||
| Standard Deviation | 1.56 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Churchill Downs Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Churchill Downs as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Churchill Downs' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Churchill Downs' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Churchill Downs Incorporated.
When determining whether Churchill Downs offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Churchill Downs' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Churchill Downs Incorporated Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Churchill Downs Incorporated Stock: Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Churchill Downs Incorporated. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in unemployment. You can also try the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Is Hotels, Restaurants & Leisure space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Churchill Downs. If investors know Churchill will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Churchill Downs listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.089 | Dividend Share 0.382 | Earnings Share 5.53 | Revenue Per Share 35.989 | Quarterly Revenue Growth 0.098 |
The market value of Churchill Downs is measured differently than its book value, which is the value of Churchill that is recorded on the company's balance sheet. Investors also form their own opinion of Churchill Downs' value that differs from its market value or its book value, called intrinsic value, which is Churchill Downs' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Churchill Downs' market value can be influenced by many factors that don't directly affect Churchill Downs' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Churchill Downs' value and its price as these two are different measures arrived at by different means. Investors typically determine if Churchill Downs is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Churchill Downs' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.