Correlation Between Liberty Broadband and Kuke Music
Can any of the company-specific risk be diversified away by investing in both Liberty Broadband and Kuke Music 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 Liberty Broadband and Kuke Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Broadband Srs and Kuke Music Holding, you can compare the effects of market volatilities on Liberty Broadband and Kuke Music 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 Liberty Broadband with a short position of Kuke Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Broadband and Kuke Music.
Diversification Opportunities for Liberty Broadband and Kuke Music
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Liberty and Kuke is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband Srs and Kuke Music Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuke Music Holding and Liberty Broadband 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 Liberty Broadband Srs are associated (or correlated) with Kuke Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuke Music Holding has no effect on the direction of Liberty Broadband i.e., Liberty Broadband and Kuke Music go up and down completely randomly.
Pair Corralation between Liberty Broadband and Kuke Music
Assuming the 90 days horizon Liberty Broadband Srs is expected to generate 0.21 times more return on investment than Kuke Music. However, Liberty Broadband Srs is 4.85 times less risky than Kuke Music. It trades about 0.09 of its potential returns per unit of risk. Kuke Music Holding is currently generating about -0.06 per unit of risk. If you would invest 8,064 in Liberty Broadband Srs on August 23, 2024 and sell it today you would earn a total of 526.00 from holding Liberty Broadband Srs or generate 6.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liberty Broadband Srs vs. Kuke Music Holding
Performance |
| Timeline |
| Liberty Broadband Srs |
| Kuke Music Holding |
Liberty Broadband and Kuke Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Broadband and Kuke Music
The main advantage of trading using opposite Liberty Broadband and Kuke Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Broadband position performs unexpectedly, Kuke Music 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 Kuke Music will offset losses from the drop in Kuke Music's long position.| Liberty Broadband vs. Small Cap Core | Liberty Broadband vs. FitLife Brands, Common | Liberty Broadband vs. Mutual Of America | Liberty Broadband vs. Gfl Environmental Holdings |
| Kuke Music vs. Cinemark Holdings | Kuke Music vs. News Corp B | Kuke Music vs. Marcus | Kuke Music vs. Liberty Media |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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