Correlation Between Highway Holdings and ELDORADO

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

By analyzing existing cross correlation between Highway Holdings Limited and ELDORADO RESORTS INC, you can compare the effects of market volatilities on Highway Holdings and ELDORADO 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 Highway Holdings with a short position of ELDORADO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highway Holdings and ELDORADO.

Diversification Opportunities for Highway Holdings and ELDORADO

0.0

Correlation Coefficient

Highway Holdings  ELDORADO

Pay attention - limited upside

The 3 months correlation between Highway and ELDORADO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Highway Holdings Limited and ELDORADO RESORTS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELDORADO RESORTS INC and Highway 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 Highway Holdings Limited are associated (or correlated) with ELDORADO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELDORADO RESORTS INC has no effect on the direction of Highway Holdings i.e., Highway Holdings and ELDORADO go up and down completely randomly.

Pair Corralation between Highway Holdings and ELDORADO

If you would invest  0.00  in ELDORADO RESORTS INC on October 23, 2024 and sell it today you would earn a total of  0.00  from holding ELDORADO RESORTS INC or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Highway Holdings Limited  vs.  ELDORADO RESORTS INC

Highway Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Highway Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

ELDORADO RESORTS INC

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days ELDORADO RESORTS INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ELDORADO is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Highway Holdings and ELDORADO

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

The idea behind Highway Holdings Limited and ELDORADO RESORTS 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.