Correlation Between Live Nation and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Live Nation and Superior Plus 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 Superior Plus 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 Superior Plus Corp, you can compare the effects of market volatilities on Live Nation and Superior Plus 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 Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Superior Plus.
Diversification Opportunities for Live Nation and Superior Plus
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Live and Superior is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp 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 Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Live Nation i.e., Live Nation and Superior Plus go up and down completely randomly.
Pair Corralation between Live Nation and Superior Plus
Assuming the 90 days horizon Live Nation Entertainment is expected to generate 0.46 times more return on investment than Superior Plus. However, Live Nation Entertainment is 2.18 times less risky than Superior Plus. It trades about 0.3 of its potential returns per unit of risk. Superior Plus Corp is currently generating about 0.12 per unit of risk. If you would invest 12,680 in Live Nation Entertainment on October 25, 2024 and sell it today you would earn a total of 560.00 from holding Live Nation Entertainment or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Nation Entertainment vs. Superior Plus Corp
Performance |
| Timeline |
| Live Nation Entertainment |
| Superior Plus Corp |
Live Nation and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and Superior Plus
The main advantage of trading using opposite Live Nation and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Live Nation vs. Dolby Laboratories | Live Nation vs. Lions Gate Entertainment | Live Nation vs. Superior Plus Corp | Live Nation vs. Origin Agritech |
| Superior Plus vs. CITY OFFICE REIT | Superior Plus vs. Infrastrutture Wireless Italiane | Superior Plus vs. Fuji Media Holdings | Superior Plus vs. Live Nation Entertainment |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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