Correlation Between PARKEN Sport and TRADEDOUBLER
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and TRADEDOUBLER 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 TRADEDOUBLER 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 TRADEDOUBLER AB SK, you can compare the effects of market volatilities on PARKEN Sport and TRADEDOUBLER 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 TRADEDOUBLER. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and TRADEDOUBLER.
Diversification Opportunities for PARKEN Sport and TRADEDOUBLER
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PARKEN and TRADEDOUBLER is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and TRADEDOUBLER AB SK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRADEDOUBLER AB SK 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 TRADEDOUBLER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRADEDOUBLER AB SK has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and TRADEDOUBLER go up and down completely randomly.
Pair Corralation between PARKEN Sport and TRADEDOUBLER
Assuming the 90 days horizon PARKEN Sport Entertainment is expected to generate 2.4 times more return on investment than TRADEDOUBLER. However, PARKEN Sport is 2.4 times more volatile than TRADEDOUBLER AB SK. It trades about 0.07 of its potential returns per unit of risk. TRADEDOUBLER AB SK is currently generating about -0.01 per unit of risk. If you would invest 690.00 in PARKEN Sport Entertainment on November 3, 2024 and sell it today you would earn a total of 1,065 from holding PARKEN Sport Entertainment or generate 154.35% 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. TRADEDOUBLER AB SK
Performance |
| Timeline |
| PARKEN Sport Enterta |
| TRADEDOUBLER AB SK |
PARKEN Sport and TRADEDOUBLER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and TRADEDOUBLER
The main advantage of trading using opposite PARKEN Sport and TRADEDOUBLER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, TRADEDOUBLER 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 TRADEDOUBLER will offset losses from the drop in TRADEDOUBLER's long position.| PARKEN Sport vs. United Utilities Group | PARKEN Sport vs. Minerals Technologies | PARKEN Sport vs. Kingdee International Software | PARKEN Sport vs. BioNTech SE |
| TRADEDOUBLER vs. Spirent Communications plc | TRADEDOUBLER vs. HEMISPHERE EGY | TRADEDOUBLER vs. RETAIL FOOD GROUP | TRADEDOUBLER vs. Cogent Communications Holdings |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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