Correlation Between Live Nation and Identiv
Can any of the company-specific risk be diversified away by investing in both Live Nation and Identiv 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 Identiv 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 Identiv, you can compare the effects of market volatilities on Live Nation and Identiv 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 Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Identiv.
Diversification Opportunities for Live Nation and Identiv
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Live and Identiv is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Live Nation i.e., Live Nation and Identiv go up and down completely randomly.
Pair Corralation between Live Nation and Identiv
Assuming the 90 days horizon Live Nation Entertainment is expected to generate 0.86 times more return on investment than Identiv. However, Live Nation Entertainment is 1.16 times less risky than Identiv. It trades about 0.35 of its potential returns per unit of risk. Identiv is currently generating about 0.19 per unit of risk. If you would invest 10,710 in Live Nation Entertainment on September 1, 2024 and sell it today you would earn a total of 2,485 from holding Live Nation Entertainment or generate 23.2% 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. Identiv
Performance |
| Timeline |
| Live Nation Entertainment |
| Identiv |
Live Nation and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and Identiv
The main advantage of trading using opposite Live Nation and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Live Nation vs. CAREER EDUCATION | Live Nation vs. ALGOMA STEEL GROUP | Live Nation vs. Xinhua Winshare Publishing | Live Nation vs. CHINA EDUCATION GROUP |
| Identiv vs. ANTA SPORTS PRODUCT | Identiv vs. PLAYTIKA HOLDING DL 01 | Identiv vs. CNVISION MEDIA | Identiv vs. PARKEN Sport 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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