Correlation Between PARKEN Sport and Live Nation
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and Live Nation 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 PARKEN Sport and Live Nation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PARKEN Sport Entertainment and Live Nation Entertainment, you can compare the effects of market volatilities on PARKEN Sport and Live Nation 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 PARKEN Sport with a short position of Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Live Nation.
Diversification Opportunities for PARKEN Sport and Live Nation
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PARKEN and Live is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Live Nation Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Nation Entertainment and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with Live Nation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Nation Entertainment has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Live Nation go up and down completely randomly.
Pair Corralation between PARKEN Sport and Live Nation
Assuming the 90 days horizon PARKEN Sport Entertainment is expected to under-perform the Live Nation. In addition to that, PARKEN Sport is 2.12 times more volatile than Live Nation Entertainment. It trades about -0.15 of its total potential returns per unit of risk. Live Nation Entertainment is currently generating about 0.45 per unit of volatility. If you would invest 12,530 in Live Nation Entertainment on November 4, 2024 and sell it today you would earn a total of 1,105 from holding Live Nation Entertainment or generate 8.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PARKEN Sport Entertainment vs. Live Nation Entertainment
Performance |
| Timeline |
| PARKEN Sport Enterta |
| Live Nation Entertainment |
PARKEN Sport and Live Nation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and Live Nation
The main advantage of trading using opposite PARKEN Sport and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, Live Nation 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 Live Nation will offset losses from the drop in Live Nation's long position.| PARKEN Sport vs. ecotel communication ag | PARKEN Sport vs. JAPAN AIRLINES | PARKEN Sport vs. Aegean Airlines SA | PARKEN Sport vs. Citic Telecom International |
| Live Nation vs. China BlueChemical | Live Nation vs. Coffee Holding Co | Live Nation vs. Quaker Chemical | Live Nation vs. Siamgas And Petrochemicals |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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