Correlation Between Century Casinos and Bluegreen Vacations

Can any of the company-specific risk be diversified away by investing in both Century Casinos and Bluegreen Vacations 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 Century Casinos and Bluegreen Vacations into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Century Casinos and Bluegreen Vacations Holding, you can compare the effects of market volatilities on Century Casinos and Bluegreen Vacations 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 Century Casinos with a short position of Bluegreen Vacations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Casinos and Bluegreen Vacations.

Diversification Opportunities for Century Casinos and Bluegreen Vacations

0.86

Correlation Coefficient

Century Casinos  Bluegreen Vacations

Very poor diversification

The 3 months correlation between Century and Bluegreen is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Century Casinos and Bluegreen Vacations Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluegreen Vacations and Century Casinos 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 Century Casinos are associated (or correlated) with Bluegreen Vacations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluegreen Vacations has no effect on the direction of Century Casinos i.e., Century Casinos and Bluegreen Vacations go up and down completely randomly.

Pair Corralation between Century Casinos and Bluegreen Vacations

If you would invest  334.00  in Century Casinos on August 31, 2024 and sell it today you would earn a total of  113.00  from holding Century Casinos or generate 33.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	4.55%
Values	Daily Returns

Century Casinos  vs.  Bluegreen Vacations Holding

Century Casinos

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Century Casinos are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Century Casinos showed solid returns over the last few months and may actually be approaching a breakup point.

Bluegreen Vacations

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bluegreen Vacations Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Bluegreen Vacations is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Century Casinos and Bluegreen Vacations

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

The idea behind Century Casinos and Bluegreen Vacations Holding 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.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.