Correlation Between Live Nation and Swiss Re
Can any of the company-specific risk be diversified away by investing in both Live Nation and Swiss Re 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 Swiss Re 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 Swiss Re AG, you can compare the effects of market volatilities on Live Nation and Swiss Re 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 Swiss Re. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Swiss Re.
Diversification Opportunities for Live Nation and Swiss Re
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Live and Swiss is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and Swiss Re AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiss Re AG 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 Swiss Re. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiss Re AG has no effect on the direction of Live Nation i.e., Live Nation and Swiss Re go up and down completely randomly.
Pair Corralation between Live Nation and Swiss Re
Assuming the 90 days horizon Live Nation Entertainment is expected to generate 1.17 times more return on investment than Swiss Re. However, Live Nation is 1.17 times more volatile than Swiss Re AG. It trades about 0.1 of its potential returns per unit of risk. Swiss Re AG is currently generating about 0.08 per unit of risk. If you would invest 6,370 in Live Nation Entertainment on October 29, 2024 and sell it today you would earn a total of 6,870 from holding Live Nation Entertainment or generate 107.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Nation Entertainment vs. Swiss Re AG
Performance |
| Timeline |
| Live Nation Entertainment |
| Swiss Re AG |
Live Nation and Swiss Re Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and Swiss Re
The main advantage of trading using opposite Live Nation and Swiss Re positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, Swiss Re 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 Swiss Re will offset losses from the drop in Swiss Re's long position.| Live Nation vs. Dolby Laboratories | Live Nation vs. Lions Gate Entertainment | Live Nation vs. Superior Plus Corp | Live Nation vs. Origin Agritech |
| Swiss Re vs. ULTRA CLEAN HLDGS | Swiss Re vs. Tsingtao Brewery | Swiss Re vs. Sims Metal Management | Swiss Re vs. Ares Management Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |