Correlation Between PARKEN Sport and CME
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and CME 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 CME 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 CME Group, you can compare the effects of market volatilities on PARKEN Sport and CME 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 CME. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and CME.
Diversification Opportunities for PARKEN Sport and CME
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PARKEN and CME is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and CME Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CME Group 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 CME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CME Group has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and CME go up and down completely randomly.
Pair Corralation between PARKEN Sport and CME
Assuming the 90 days horizon PARKEN Sport Entertainment is expected to generate 2.18 times more return on investment than CME. However, PARKEN Sport is 2.18 times more volatile than CME Group. It trades about 0.09 of its potential returns per unit of risk. CME Group is currently generating about 0.13 per unit of risk. If you would invest 1,630 in PARKEN Sport Entertainment on October 11, 2024 and sell it today you would earn a total of 135.00 from holding PARKEN Sport Entertainment or generate 8.28% 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. CME Group
Performance |
| Timeline |
| PARKEN Sport Enterta |
| CME Group |
PARKEN Sport and CME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and CME
The main advantage of trading using opposite PARKEN Sport and CME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, CME 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 CME will offset losses from the drop in CME's long position.| PARKEN Sport vs. Laureate Education | PARKEN Sport vs. Adtalem Global Education | PARKEN Sport vs. YATRA ONLINE DL 0001 | PARKEN Sport vs. Gruppo Mutuionline SpA |
| CME vs. SPORTING | CME vs. PARKEN Sport Entertainment | CME vs. Transport International Holdings | CME vs. MAVEN WIRELESS SWEDEN |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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