Correlation Between Penn National and Lord Global

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

By analyzing existing cross correlation between Penn National Gaming and Lord Global Corp, you can compare the effects of market volatilities on Penn National and Lord Global 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 Penn National with a short position of Lord Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penn National and Lord Global.

Diversification Opportunities for Penn National and Lord Global

0.0

Correlation Coefficient

Penn National  Lord Global

Pay attention - limited upside

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

Pair Corralation between Penn National and Lord Global

If you would invest (100.00) in Lord Global Corp on December 17, 2024 and sell it today you would earn a total of  100.00  from holding Lord Global Corp or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Penn National Gaming  vs.  Lord Global Corp

Penn National Gaming

Risk-Adjusted Performance

Very Weak

Over the last 90 days Penn National Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Lord Global Corp

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Penn National and Lord Global

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

The idea behind Penn National Gaming and Lord Global Corp 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.