Correlation Between FRACTAL GAMING and Penn National

Can any of the company-specific risk be diversified away by investing in both FRACTAL GAMING and Penn National 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 FRACTAL GAMING and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FRACTAL GAMING GROUP and Penn National Gaming, you can compare the effects of market volatilities on FRACTAL GAMING and Penn National 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 FRACTAL GAMING with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRACTAL GAMING and Penn National.

Diversification Opportunities for FRACTAL GAMING and Penn National

0.05

Correlation Coefficient

FRACTAL GAMING  Penn National

Significant diversification

The 3 months correlation between FRACTAL and Penn is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding FRACTAL GAMING GROUP and Penn National Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penn National Gaming and FRACTAL GAMING 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 FRACTAL GAMING GROUP are associated (or correlated) with Penn National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penn National Gaming has no effect on the direction of FRACTAL GAMING i.e., FRACTAL GAMING and Penn National go up and down completely randomly.

Pair Corralation between FRACTAL GAMING and Penn National

Assuming the 90 days horizon FRACTAL GAMING GROUP is expected to generate 0.82 times more return on investment than Penn National. However, FRACTAL GAMING GROUP is 1.22 times less risky than Penn National. It trades about 0.13 of its potential returns per unit of risk. Penn National Gaming is currently generating about -0.05 per unit of risk. If you would invest  267.00  in FRACTAL GAMING GROUP on December 21, 2024 and sell it today you would earn a total of  55.00  from holding FRACTAL GAMING GROUP or generate 20.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

FRACTAL GAMING GROUP  vs.  Penn National Gaming

FRACTAL GAMING GROUP

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in FRACTAL GAMING GROUP are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, FRACTAL GAMING reported solid returns over the last few months and may actually be approaching a breakup point.

Penn National Gaming

Risk-Adjusted Performance

Very Weak

Over the last 90 days Penn National Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with FRACTAL GAMING and Penn National

The main advantage of trading using opposite FRACTAL GAMING and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FRACTAL GAMING position performs unexpectedly, Penn National 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 Penn National will offset losses from the drop in Penn National's long position.

The idea behind FRACTAL GAMING GROUP and Penn National Gaming pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.