Correlation Between Table Trac and Full House

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

By analyzing existing cross correlation between Table Trac and Full House Resorts, you can compare the effects of market volatilities on Table Trac and Full House 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 Table Trac with a short position of Full House. Check out your portfolio center. Please also check ongoing floating volatility patterns of Table Trac and Full House.

Diversification Opportunities for Table Trac and Full House

-0.21

Correlation Coefficient

Table Trac  Full House

Very good diversification

The 3 months correlation between Table and Full is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Table Trac and Full House Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Full House Resorts and Table Trac 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 Table Trac are associated (or correlated) with Full House. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Full House Resorts has no effect on the direction of Table Trac i.e., Table Trac and Full House go up and down completely randomly.

Pair Corralation between Table Trac and Full House

Given the investment horizon of 90 days Table Trac is expected to generate 1.63 times more return on investment than Full House. However, Table Trac is 1.63 times more volatile than Full House Resorts. It trades about 0.01 of its potential returns per unit of risk. Full House Resorts is currently generating about -0.1 per unit of risk. If you would invest  397.00  in Table Trac on September 14, 2024 and sell it today you would lose (3.00) from holding Table Trac or give up 0.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Table Trac  vs.  Full House Resorts

Table Trac

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Table Trac has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Table Trac is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Full House Resorts

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Full House Resorts has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Table Trac and Full House

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

The idea behind Table Trac and Full House Resorts 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.