Correlation Between Penn National and IShares Public

Can any of the company-specific risk be diversified away by investing in both Penn National and IShares Public 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 IShares Public 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 IShares Public Limited, you can compare the effects of market volatilities on Penn National and IShares Public 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 IShares Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penn National and IShares Public.

Diversification Opportunities for Penn National and IShares Public

0.0

Correlation Coefficient

Penn National  IShares Public

Pay attention - limited upside

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

Pair Corralation between Penn National and IShares Public

If you would invest (100.00) in IShares Public Limited on October 7, 2024 and sell it today you would earn a total of  100.00  from holding IShares Public Limited 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.  IShares Public Limited

Penn National Gaming

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Penn National Gaming are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Penn National is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

IShares Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days IShares Public Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, IShares Public 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 IShares Public

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

The idea behind Penn National Gaming and IShares Public Limited 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.