Correlation Between IONQ and Entain Plc

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

By analyzing existing cross correlation between IONQ Inc and Entain Plc, you can compare the effects of market volatilities on IONQ and Entain Plc 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 IONQ with a short position of Entain Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of IONQ and Entain Plc.

Diversification Opportunities for IONQ and Entain Plc

-0.03

Correlation Coefficient

IONQ  Entain Plc

Good diversification

The 3 months correlation between IONQ and Entain is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding IONQ Inc and Entain Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entain Plc and IONQ 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 IONQ Inc are associated (or correlated) with Entain Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entain Plc has no effect on the direction of IONQ i.e., IONQ and Entain Plc go up and down completely randomly.

Pair Corralation between IONQ and Entain Plc

Given the investment horizon of 90 days IONQ Inc is expected to under-perform the Entain Plc. In addition to that, IONQ is 2.36 times more volatile than Entain Plc. It trades about -0.06 of its total potential returns per unit of risk. Entain Plc is currently generating about 0.01 per unit of volatility. If you would invest  844.00  in Entain Plc on December 28, 2024 and sell it today you would lose (19.00) from holding Entain Plc or give up 2.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

IONQ Inc  vs.  Entain Plc

IONQ Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days IONQ Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Entain Plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Entain Plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical indicators, Entain Plc is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with IONQ and Entain Plc

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

The idea behind IONQ Inc and Entain Plc 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.