Correlation Between Disney and Cowen
Can any of the company-specific risk be diversified away by investing in both Disney and Cowen 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 Disney and Cowen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walt Disney and Cowen Group, you can compare the effects of market volatilities on Disney and Cowen 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 Disney with a short position of Cowen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Disney and Cowen.
Diversification Opportunities for Disney and Cowen
Very poor diversification
The 3 months correlation between Disney and Cowen is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney and Cowen Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cowen Group and Disney 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 Walt Disney are associated (or correlated) with Cowen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cowen Group has no effect on the direction of Disney i.e., Disney and Cowen go up and down completely randomly.
Pair Corralation between Disney and Cowen
If you would invest 9,363 in Walt Disney on September 3, 2024 and sell it today you would earn a total of 2,384 from holding Walt Disney or generate 25.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 2.38% |
| Values | Daily Returns |
Walt Disney vs. Cowen Group
Performance |
| Timeline |
| Walt Disney |
| Cowen Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Disney and Cowen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Disney and Cowen
The main advantage of trading using opposite Disney and Cowen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney position performs unexpectedly, Cowen 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 Cowen will offset losses from the drop in Cowen's long position.| Disney vs. Roku Inc | Disney vs. AMC Entertainment Holdings | Disney vs. Paramount Global Class | Disney vs. Warner Bros Discovery |
| Cowen vs. Ihuman Inc | Cowen vs. Where Food Comes | Cowen vs. Cadence Design Systems | Cowen vs. Zane Interactive Publishing |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |