Correlation Between Penn National and Mmzhx
Can any of the company-specific risk be diversified away by investing in both Penn National and Mmzhx 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 Mmzhx 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 Mmzhx, you can compare the effects of market volatilities on Penn National and Mmzhx 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 Mmzhx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penn National and Mmzhx.
Diversification Opportunities for Penn National and Mmzhx
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Penn and Mmzhx is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Penn National Gaming and Mmzhx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mmzhx 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 Mmzhx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mmzhx has no effect on the direction of Penn National i.e., Penn National and Mmzhx go up and down completely randomly.
Pair Corralation between Penn National and Mmzhx
Given the investment horizon of 90 days Penn National Gaming is expected to under-perform the Mmzhx. In addition to that, Penn National is 1.26 times more volatile than Mmzhx. It trades about -0.02 of its total potential returns per unit of risk. Mmzhx is currently generating about 0.03 per unit of volatility. If you would invest 1,135 in Mmzhx on October 23, 2024 and sell it today you would earn a total of 64.00 from holding Mmzhx or generate 5.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 30.36% |
Values | Daily Returns |
Penn National Gaming vs. Mmzhx
Performance |
Timeline |
Penn National Gaming |
Mmzhx |
Penn National and Mmzhx Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Penn National and Mmzhx
The main advantage of trading using opposite Penn National and Mmzhx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penn National position performs unexpectedly, Mmzhx 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 Mmzhx will offset losses from the drop in Mmzhx's long position.Penn National vs. DraftKings | Penn National vs. MGM Resorts International | Penn National vs. Caesars Entertainment | Penn National vs. Boyd Gaming |
Mmzhx vs. Adams Natural Resources | Mmzhx vs. Salient Mlp Energy | Mmzhx vs. Advisory Research Mlp | Mmzhx vs. Invesco Energy Fund |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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