Correlation Between Everi Holdings and PlayAGS

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Can any of the company-specific risk be diversified away by investing in both Everi Holdings and PlayAGS 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 Everi Holdings and PlayAGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Everi Holdings and PlayAGS, you can compare the effects of market volatilities on Everi Holdings and PlayAGS 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 Everi Holdings with a short position of PlayAGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Everi Holdings and PlayAGS.

Diversification Opportunities for Everi Holdings and PlayAGS

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Everi and PlayAGS is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Everi Holdings and PlayAGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlayAGS and Everi Holdings 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 Everi Holdings are associated (or correlated) with PlayAGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlayAGS has no effect on the direction of Everi Holdings i.e., Everi Holdings and PlayAGS go up and down completely randomly.

Pair Corralation between Everi Holdings and PlayAGS

Given the investment horizon of 90 days Everi Holdings is expected to generate 5.55 times more return on investment than PlayAGS. However, Everi Holdings is 5.55 times more volatile than PlayAGS. It trades about 0.13 of its potential returns per unit of risk. PlayAGS is currently generating about -0.19 per unit of risk. If you would invest  816.00  in Everi Holdings on April 14, 2024 and sell it today you would earn a total of  46.00  from holding Everi Holdings or generate 5.64% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Everi Holdings  vs.  PlayAGS

 Performance 
       Timeline  
Everi Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Everi Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Everi Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.
PlayAGS 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in PlayAGS are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal technical and fundamental indicators, PlayAGS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Everi Holdings and PlayAGS Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Everi Holdings and PlayAGS

The main advantage of trading using opposite Everi Holdings and PlayAGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Everi Holdings position performs unexpectedly, PlayAGS 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 PlayAGS will offset losses from the drop in PlayAGS's long position.
The idea behind Everi Holdings and PlayAGS 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

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