Correlation Between Wynn Macau and Table Trac

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

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

Diversification Opportunities for Wynn Macau and Table Trac

-0.29

Correlation Coefficient

Wynn Macau  Table Trac

Very good diversification

The 3 months correlation between Wynn and Table is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Wynn Macau and Table Trac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Table Trac and Wynn Macau 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 Wynn Macau are associated (or correlated) with Table Trac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Table Trac has no effect on the direction of Wynn Macau i.e., Wynn Macau and Table Trac go up and down completely randomly.

Pair Corralation between Wynn Macau and Table Trac

Assuming the 90 days horizon Wynn Macau is expected to generate 1.24 times more return on investment than Table Trac. However, Wynn Macau is 1.24 times more volatile than Table Trac. It trades about 0.05 of its potential returns per unit of risk. Table Trac is currently generating about 0.02 per unit of risk. If you would invest  65.00  in Wynn Macau on December 27, 2024 and sell it today you would earn a total of  4.00  from holding Wynn Macau or generate 6.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Wynn Macau  vs.  Table Trac

Wynn Macau

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Wynn Macau are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Wynn Macau may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Table Trac

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Table Trac are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. 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.

Pair Trading with Wynn Macau and Table Trac

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

The idea behind Wynn Macau and Table Trac 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.