Correlation Between Live Nation and FRASERS PROPERTY
Can any of the company-specific risk be diversified away by investing in both Live Nation and FRASERS PROPERTY 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 Live Nation and FRASERS PROPERTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Nation Entertainment and FRASERS PROPERTY, you can compare the effects of market volatilities on Live Nation and FRASERS PROPERTY 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 Live Nation with a short position of FRASERS PROPERTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and FRASERS PROPERTY.
Diversification Opportunities for Live Nation and FRASERS PROPERTY
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Live and FRASERS is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and FRASERS PROPERTY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRASERS PROPERTY and Live Nation 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 Live Nation Entertainment are associated (or correlated) with FRASERS PROPERTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRASERS PROPERTY has no effect on the direction of Live Nation i.e., Live Nation and FRASERS PROPERTY go up and down completely randomly.
Pair Corralation between Live Nation and FRASERS PROPERTY
Assuming the 90 days horizon Live Nation Entertainment is expected to generate 0.99 times more return on investment than FRASERS PROPERTY. However, Live Nation Entertainment is 1.01 times less risky than FRASERS PROPERTY. It trades about 0.07 of its potential returns per unit of risk. FRASERS PROPERTY is currently generating about 0.0 per unit of risk. If you would invest 6,070 in Live Nation Entertainment on January 10, 2025 and sell it today you would earn a total of 4,910 from holding Live Nation Entertainment or generate 80.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Nation Entertainment vs. FRASERS PROPERTY
Performance |
| Timeline |
| Live Nation Entertainment |
| FRASERS PROPERTY |
Live Nation and FRASERS PROPERTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and FRASERS PROPERTY
The main advantage of trading using opposite Live Nation and FRASERS PROPERTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, FRASERS PROPERTY 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 FRASERS PROPERTY will offset losses from the drop in FRASERS PROPERTY's long position.| Live Nation vs. Dolby Laboratories | Live Nation vs. CTS Eventim AG | Live Nation vs. Toho Co | Live Nation vs. Lions Gate Entertainment |
| FRASERS PROPERTY vs. OPEN HOUSE GROUP | FRASERS PROPERTY vs. AEON MALL LTD | FRASERS PROPERTY vs. Hufvudstaden AB | FRASERS PROPERTY vs. Hang Lung Group |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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