Correlation Between PENN Entertainment, and Ita Unibanco

Can any of the company-specific risk be diversified away by investing in both PENN Entertainment, and Ita Unibanco 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 Entertainment, and Ita Unibanco into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PENN Entertainment, and Ita Unibanco Holding, you can compare the effects of market volatilities on PENN Entertainment, and Ita Unibanco 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 Entertainment, with a short position of Ita Unibanco. Check out your portfolio center. Please also check ongoing floating volatility patterns of PENN Entertainment, and Ita Unibanco.

Diversification Opportunities for PENN Entertainment, and Ita Unibanco

-0.84

Correlation Coefficient

PENN Entertainment,  Ita Unibanco

Pay attention - limited upside

The 3 months correlation between PENN and Ita is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding PENN Entertainment, and Ita Unibanco Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ita Unibanco Holding and PENN Entertainment, 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 Entertainment, are associated (or correlated) with Ita Unibanco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ita Unibanco Holding has no effect on the direction of PENN Entertainment, i.e., PENN Entertainment, and Ita Unibanco go up and down completely randomly.

Pair Corralation between PENN Entertainment, and Ita Unibanco

Assuming the 90 days trading horizon PENN Entertainment, is expected to generate 1.3 times more return on investment than Ita Unibanco. However, PENN Entertainment, is 1.3 times more volatile than Ita Unibanco Holding. It trades about 0.26 of its potential returns per unit of risk. Ita Unibanco Holding is currently generating about -0.11 per unit of risk. If you would invest  903.00  in PENN Entertainment, on April 14, 2025 and sell it today you would earn a total of  90.00  from holding PENN Entertainment, or generate 9.97% return on investment over 90 days.

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

PENN Entertainment,  vs.  Ita Unibanco Holding

PENN Entertainment,

Risk-Adjusted Performance

Very Weak

Over the last 90 days PENN Entertainment, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Ita Unibanco Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ita Unibanco Holding are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Ita Unibanco may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with PENN Entertainment, and Ita Unibanco

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

The idea behind PENN Entertainment, and Ita Unibanco Holding 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.