Correlation Between Live Nation and MISUMI
Can any of the company-specific risk be diversified away by investing in both Live Nation and MISUMI 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 Live Nation and MISUMI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Nation Entertainment and MISUMI Group, you can compare the effects of market volatilities on Live Nation and MISUMI 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 Live Nation with a short position of MISUMI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and MISUMI.
Diversification Opportunities for Live Nation and MISUMI
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Live and MISUMI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and MISUMI Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MISUMI Group and Live Nation 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 Live Nation Entertainment are associated (or correlated) with MISUMI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MISUMI Group has no effect on the direction of Live Nation i.e., Live Nation and MISUMI go up and down completely randomly.
Pair Corralation between Live Nation and MISUMI
Considering the 90-day investment horizon Live Nation Entertainment is expected to generate 1.6 times more return on investment than MISUMI. However, Live Nation is 1.6 times more volatile than MISUMI Group. It trades about 0.12 of its potential returns per unit of risk. MISUMI Group is currently generating about 0.08 per unit of risk. If you would invest 9,022 in Live Nation Entertainment on September 3, 2024 and sell it today you would earn a total of 4,803 from holding Live Nation Entertainment or generate 53.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 76.75% |
| Values | Daily Returns |
Live Nation Entertainment vs. MISUMI Group
Performance |
| Timeline |
| Live Nation Entertainment |
| MISUMI Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Live Nation and MISUMI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and MISUMI
The main advantage of trading using opposite Live Nation and MISUMI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, MISUMI 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 MISUMI will offset losses from the drop in MISUMI's long position.| Live Nation vs. Liberty Media | Live Nation vs. Atlanta Braves Holdings, | Live Nation vs. News Corp B | Live Nation vs. News Corp A |
| MISUMI vs. Eastern Co | MISUMI vs. Hillman Solutions Corp | MISUMI vs. Techtronic Industries Ltd | MISUMI vs. Husqvarna AB |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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