Correlation Between Evolution Gaming and Everi Holdings

Can any of the company-specific risk be diversified away by investing in both Evolution Gaming and Everi Holdings 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 Evolution Gaming and Everi Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Evolution Gaming Group and Everi Holdings, you can compare the effects of market volatilities on Evolution Gaming and Everi Holdings 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 Evolution Gaming with a short position of Everi Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Gaming and Everi Holdings.

Diversification Opportunities for Evolution Gaming and Everi Holdings

-0.79

Correlation Coefficient

Evolution Gaming  Everi Holdings

Pay attention - limited upside

The 3 months correlation between Evolution and Everi is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Gaming Group and Everi Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everi Holdings and Evolution 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 Evolution Gaming Group are associated (or correlated) with Everi Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everi Holdings has no effect on the direction of Evolution Gaming i.e., Evolution Gaming and Everi Holdings go up and down completely randomly.

Pair Corralation between Evolution Gaming and Everi Holdings

Assuming the 90 days horizon Evolution Gaming Group is expected to under-perform the Everi Holdings. In addition to that, Evolution Gaming is 13.23 times more volatile than Everi Holdings. It trades about -0.08 of its total potential returns per unit of risk. Everi Holdings is currently generating about 0.29 per unit of volatility. If you would invest  1,302  in Everi Holdings on September 4, 2024 and sell it today you would earn a total of  44.00  from holding Everi Holdings or generate 3.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Evolution Gaming Group  vs.  Everi Holdings

Evolution Gaming

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Evolution Gaming Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Everi Holdings

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Everi Holdings are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Everi Holdings is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Evolution Gaming and Everi Holdings

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

The idea behind Evolution Gaming Group and Everi Holdings 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 Commodity Directory module to find actively traded commodities issued by global exchanges.