Correlation Between Everi Holdings and Golden Entertainment
Can any of the company-specific risk be diversified away by investing in both Everi Holdings and Golden Entertainment 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 Everi Holdings and Golden Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Everi Holdings and Golden Entertainment, you can compare the effects of market volatilities on Everi Holdings and Golden Entertainment 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 Everi Holdings with a short position of Golden Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Everi Holdings and Golden Entertainment.
Diversification Opportunities for Everi Holdings and Golden Entertainment
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Everi and Golden is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Everi Holdings and Golden Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Entertainment and Everi Holdings 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 Everi Holdings are associated (or correlated) with Golden Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Entertainment has no effect on the direction of Everi Holdings i.e., Everi Holdings and Golden Entertainment go up and down completely randomly.
Pair Corralation between Everi Holdings and Golden Entertainment
Given the investment horizon of 90 days Everi Holdings is expected to under-perform the Golden Entertainment. In addition to that, Everi Holdings is 1.12 times more volatile than Golden Entertainment. It trades about -0.07 of its total potential returns per unit of risk. Golden Entertainment is currently generating about 0.04 per unit of volatility. If you would invest 3,317 in Golden Entertainment on December 29, 2023 and sell it today you would earn a total of 333.50 from holding Golden Entertainment or generate 10.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 99.19% |
Values | Daily Returns |
Everi Holdings vs. Golden Entertainment
Performance |
Timeline |
Everi Holdings |
Golden Entertainment |
Everi Holdings and Golden Entertainment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Everi Holdings and Golden Entertainment
The main advantage of trading using opposite Everi Holdings and Golden Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Everi Holdings position performs unexpectedly, Golden Entertainment 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 Golden Entertainment will offset losses from the drop in Golden Entertainment's long position.Everi Holdings vs. Hyatt Hotels | Everi Holdings vs. Smart Share Global | Everi Holdings vs. Wyndham Hotels Resorts | Everi Holdings vs. WW International |
Golden Entertainment vs. Hyatt Hotels | Golden Entertainment vs. Smart Share Global | Golden Entertainment vs. Wyndham Hotels Resorts | Golden Entertainment vs. WW 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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