Correlation Between Brunswick and Seaport Entertainment
Can any of the company-specific risk be diversified away by investing in both Brunswick and Seaport 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 and Seaport Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brunswick and Seaport Entertainment Group, you can compare the effects of market volatilities on Brunswick and Seaport 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 with a short position of Seaport Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brunswick and Seaport Entertainment.
Diversification Opportunities for Brunswick and Seaport Entertainment
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Brunswick and Seaport is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Brunswick and Seaport Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seaport Entertainment and Brunswick 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 are associated (or correlated) with Seaport Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seaport Entertainment has no effect on the direction of Brunswick i.e., Brunswick and Seaport Entertainment go up and down completely randomly.
Pair Corralation between Brunswick and Seaport Entertainment
Allowing for the 90-day total investment horizon Brunswick is expected to generate 1.96 times less return on investment than Seaport Entertainment. But when comparing it to its historical volatility, Brunswick is 2.28 times less risky than Seaport Entertainment. It trades about 0.02 of its potential returns per unit of risk. Seaport Entertainment Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,991 in Seaport Entertainment Group on September 14, 2024 and sell it today you would lose (123.00) from holding Seaport Entertainment Group or give up 4.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 19.6% |
| Values | Daily Returns |
Brunswick vs. Seaport Entertainment Group
Performance |
| Timeline |
| Brunswick |
| Seaport Entertainment |
Brunswick and Seaport Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brunswick and Seaport Entertainment
The main advantage of trading using opposite Brunswick and Seaport Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brunswick position performs unexpectedly, Seaport 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 Seaport Entertainment will offset losses from the drop in Seaport Entertainment's long position.| Brunswick vs. Clarus Corp | Brunswick vs. Johnson Outdoors | Brunswick vs. JAKKS Pacific | Brunswick vs. OneSpaWorld Holdings |
| Seaport Entertainment vs. Coty Inc | Seaport Entertainment vs. Brunswick | Seaport Entertainment vs. Hooker Furniture | Seaport Entertainment vs. Saia Inc |
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 Stocks Directory module to find actively traded stocks across global markets.
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