Correlation Between Evolution Gaming and MARRIOTT

Can any of the company-specific risk be diversified away by investing in both Evolution Gaming and MARRIOTT 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 MARRIOTT 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 MARRIOTT INTERNATIONAL INC, you can compare the effects of market volatilities on Evolution Gaming and MARRIOTT 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 MARRIOTT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Gaming and MARRIOTT.

Diversification Opportunities for Evolution Gaming and MARRIOTT

0.14

Correlation Coefficient

Evolution Gaming  MARRIOTT

Average diversification

The 3 months correlation between Evolution and MARRIOTT is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Gaming Group and MARRIOTT INTERNATIONAL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARRIOTT INTERNATIONAL 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 MARRIOTT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARRIOTT INTERNATIONAL has no effect on the direction of Evolution Gaming i.e., Evolution Gaming and MARRIOTT go up and down completely randomly.

Pair Corralation between Evolution Gaming and MARRIOTT

Assuming the 90 days horizon Evolution Gaming Group is expected to under-perform the MARRIOTT. In addition to that, Evolution Gaming is 3.91 times more volatile than MARRIOTT INTERNATIONAL INC. It trades about -0.16 of its total potential returns per unit of risk. MARRIOTT INTERNATIONAL INC is currently generating about -0.17 per unit of volatility. If you would invest  10,104  in MARRIOTT INTERNATIONAL INC on September 26, 2024 and sell it today you would lose (694.00) from holding MARRIOTT INTERNATIONAL INC or give up 6.87% of portfolio value over 90 days.

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

Evolution Gaming Group  vs.  MARRIOTT INTERNATIONAL INC

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 weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

MARRIOTT INTERNATIONAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MARRIOTT INTERNATIONAL INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for MARRIOTT INTERNATIONAL INC investors.

Pair Trading with Evolution Gaming and MARRIOTT

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

The idea behind Evolution Gaming Group and MARRIOTT INTERNATIONAL INC 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.