Correlation Between Gaia and Live Nation
Can any of the company-specific risk be diversified away by investing in both Gaia 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 Gaia and Live Nation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaia Inc and Live Nation Entertainment, you can compare the effects of market volatilities on Gaia 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 Gaia with a short position of Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaia and Live Nation.
Diversification Opportunities for Gaia and Live Nation
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gaia and Live is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Gaia Inc 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 Gaia 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 Gaia Inc 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 Gaia i.e., Gaia and Live Nation go up and down completely randomly.
Pair Corralation between Gaia and Live Nation
Given the investment horizon of 90 days Gaia is expected to generate 1.14 times less return on investment than Live Nation. In addition to that, Gaia is 1.46 times more volatile than Live Nation Entertainment. It trades about 0.24 of its total potential returns per unit of risk. Live Nation Entertainment is currently generating about 0.4 per unit of volatility. If you would invest 11,843 in Live Nation Entertainment on August 27, 2024 and sell it today you would earn a total of 2,186 from holding Live Nation Entertainment or generate 18.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaia Inc vs. Live Nation Entertainment
Performance |
| Timeline |
| Gaia Inc |
| Live Nation Entertainment |
Gaia and Live Nation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaia and Live Nation
The main advantage of trading using opposite Gaia and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaia 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.| Gaia vs. ADTRAN Inc | Gaia vs. Belden Inc | Gaia vs. ADC Therapeutics SA | Gaia vs. Comtech Telecommunications Corp |
| Live Nation vs. Liberty Media | Live Nation vs. Atlanta Braves Holdings, | Live Nation vs. News Corp B | Live Nation vs. News Corp A |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |