Correlation Between Brunswick Corp and Esports Entertainment
Can any of the company-specific risk be diversified away by investing in both Brunswick Corp and Esports Entertainment 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 Brunswick Corp and Esports Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brunswick Corp and Esports Entertainment Group, you can compare the effects of market volatilities on Brunswick Corp and Esports Entertainment 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 Brunswick Corp with a short position of Esports Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brunswick Corp and Esports Entertainment.
Diversification Opportunities for Brunswick Corp and Esports Entertainment
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brunswick and Esports is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Brunswick Corp and Esports Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esports Entertainment and Brunswick Corp 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 Brunswick Corp are associated (or correlated) with Esports Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esports Entertainment has no effect on the direction of Brunswick Corp i.e., Brunswick Corp and Esports Entertainment go up and down completely randomly.
Pair Corralation between Brunswick Corp and Esports Entertainment
Assuming the 90 days horizon Brunswick Corp is expected to generate 231.85 times less return on investment than Esports Entertainment. But when comparing it to its historical volatility, Brunswick Corp is 57.22 times less risky than Esports Entertainment. It trades about 0.03 of its potential returns per unit of risk. Esports Entertainment Group is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2.48 in Esports Entertainment Group on September 2, 2024 and sell it today you would lose (2.04) from holding Esports Entertainment Group or give up 82.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 16.73% |
| Values | Daily Returns |
Brunswick Corp vs. Esports Entertainment Group
Performance |
| Timeline |
| Brunswick Corp |
| Esports Entertainment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Brunswick Corp and Esports Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brunswick Corp and Esports Entertainment
The main advantage of trading using opposite Brunswick Corp and Esports Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brunswick Corp position performs unexpectedly, Esports Entertainment 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 Esports Entertainment will offset losses from the drop in Esports Entertainment's long position.| Brunswick Corp vs. BRP Inc | Brunswick Corp vs. Vision Marine Technologies | Brunswick Corp vs. EZGO Technologies | Brunswick Corp vs. Harley Davidson |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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