Correlation Between Cube Entertainment and Alton Sports
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and Alton Sports 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 Cube Entertainment and Alton Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and Alton Sports CoLtd, you can compare the effects of market volatilities on Cube Entertainment and Alton Sports 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 Cube Entertainment with a short position of Alton Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and Alton Sports.
Diversification Opportunities for Cube Entertainment and Alton Sports
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cube and Alton is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and Alton Sports CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alton Sports CoLtd and Cube 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 Cube Entertainment are associated (or correlated) with Alton Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alton Sports CoLtd has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and Alton Sports go up and down completely randomly.
Pair Corralation between Cube Entertainment and Alton Sports
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 1.8 times more return on investment than Alton Sports. However, Cube Entertainment is 1.8 times more volatile than Alton Sports CoLtd. It trades about 0.34 of its potential returns per unit of risk. Alton Sports CoLtd is currently generating about -0.35 per unit of risk. If you would invest 1,379,000 in Cube Entertainment on September 4, 2024 and sell it today you would earn a total of 286,000 from holding Cube Entertainment or generate 20.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cube Entertainment vs. Alton Sports CoLtd
Performance |
| Timeline |
| Cube Entertainment |
| Alton Sports CoLtd |
Cube Entertainment and Alton Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and Alton Sports
The main advantage of trading using opposite Cube Entertainment and Alton Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, Alton Sports 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 Alton Sports will offset losses from the drop in Alton Sports' long position.| Cube Entertainment vs. SK Chemicals Co | Cube Entertainment vs. Sung Bo Chemicals | Cube Entertainment vs. Daedong Metals Co | Cube Entertainment vs. Kbi Metal Co |
| Alton Sports vs. Korea Real Estate | Alton Sports vs. Busan Industrial Co | Alton Sports vs. UNISEM Co | Alton Sports vs. RPBio Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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