Correlation Between Chicken Soup and Chicken Soup
Can any of the company-specific risk be diversified away by investing in both Chicken Soup and Chicken Soup 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 Chicken Soup and Chicken Soup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chicken Soup for and Chicken Soup For, you can compare the effects of market volatilities on Chicken Soup and Chicken Soup 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 Chicken Soup with a short position of Chicken Soup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chicken Soup and Chicken Soup.
Diversification Opportunities for Chicken Soup and Chicken Soup
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chicken and Chicken is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Chicken Soup for and Chicken Soup For in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicken Soup For and Chicken Soup 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 Chicken Soup for are associated (or correlated) with Chicken Soup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicken Soup For has no effect on the direction of Chicken Soup i.e., Chicken Soup and Chicken Soup go up and down completely randomly.
Pair Corralation between Chicken Soup and Chicken Soup
Assuming the 90 days horizon Chicken Soup for is expected to under-perform the Chicken Soup. But the stock apears to be less risky and, when comparing its historical volatility, Chicken Soup for is 2.24 times less risky than Chicken Soup. The stock trades about -0.14 of its potential returns per unit of risk. The Chicken Soup For is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 609.00 in Chicken Soup For on September 2, 2024 and sell it today you would lose (569.00) from holding Chicken Soup For or give up 93.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.31% |
| Values | Daily Returns |
Chicken Soup for vs. Chicken Soup For
Performance |
| Timeline |
| Chicken Soup for |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Chicken Soup For |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Chicken Soup and Chicken Soup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chicken Soup and Chicken Soup
The main advantage of trading using opposite Chicken Soup and Chicken Soup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chicken Soup position performs unexpectedly, Chicken Soup 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 Chicken Soup will offset losses from the drop in Chicken Soup's long position.The idea behind Chicken Soup for and Chicken Soup For pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Chicken Soup vs. AMC Networks | Chicken Soup vs. Lions Gate Entertainment | Chicken Soup vs. Reservoir Media | Chicken Soup vs. Marcus |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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