Correlation Between Entertainment Network and SEPC
Can any of the company-specific risk be diversified away by investing in both Entertainment Network and SEPC 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 Entertainment Network and SEPC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entertainment Network Limited and SEPC Limited, you can compare the effects of market volatilities on Entertainment Network and SEPC 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 Entertainment Network with a short position of SEPC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entertainment Network and SEPC.
Diversification Opportunities for Entertainment Network and SEPC
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Entertainment and SEPC is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Entertainment Network Limited and SEPC Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEPC Limited and Entertainment Network 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 Entertainment Network Limited are associated (or correlated) with SEPC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEPC Limited has no effect on the direction of Entertainment Network i.e., Entertainment Network and SEPC go up and down completely randomly.
Pair Corralation between Entertainment Network and SEPC
Assuming the 90 days trading horizon Entertainment Network Limited is expected to generate 0.43 times more return on investment than SEPC. However, Entertainment Network Limited is 2.33 times less risky than SEPC. It trades about -0.36 of its potential returns per unit of risk. SEPC Limited is currently generating about -0.3 per unit of risk. If you would invest 19,136 in Entertainment Network Limited on October 10, 2024 and sell it today you would lose (1,577) from holding Entertainment Network Limited or give up 8.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Entertainment Network Limited vs. SEPC Limited
Performance |
| Timeline |
| Entertainment Network |
| SEPC Limited |
Entertainment Network and SEPC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entertainment Network and SEPC
The main advantage of trading using opposite Entertainment Network and SEPC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entertainment Network position performs unexpectedly, SEPC 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 SEPC will offset losses from the drop in SEPC's long position.| Entertainment Network vs. State Bank of | Entertainment Network vs. Life Insurance | Entertainment Network vs. HDFC Bank Limited | Entertainment Network vs. ICICI Bank Limited |
| SEPC vs. Hindware Home Innovation | SEPC vs. Eros International Media | SEPC vs. DJ Mediaprint Logistics | SEPC vs. Touchwood Entertainment Limited |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |