Correlation Between Live Nation and Sphere Entertainment
Can any of the company-specific risk be diversified away by investing in both Live Nation and Sphere Entertainment 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 Sphere Entertainment 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 Sphere Entertainment Co, you can compare the effects of market volatilities on Live Nation and Sphere Entertainment 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 Sphere Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Sphere Entertainment.
Diversification Opportunities for Live Nation and Sphere Entertainment
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Live and Sphere is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and Sphere Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sphere Entertainment 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 Sphere Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sphere Entertainment has no effect on the direction of Live Nation i.e., Live Nation and Sphere Entertainment go up and down completely randomly.
Pair Corralation between Live Nation and Sphere Entertainment
Considering the 90-day investment horizon Live Nation Entertainment is expected to generate 0.9 times more return on investment than Sphere Entertainment. However, Live Nation Entertainment is 1.12 times less risky than Sphere Entertainment. It trades about 0.36 of its potential returns per unit of risk. Sphere Entertainment Co is currently generating about -0.15 per unit of risk. If you would invest 11,881 in Live Nation Entertainment on August 30, 2024 and sell it today you would earn a total of 2,092 from holding Live Nation Entertainment or generate 17.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Nation Entertainment vs. Sphere Entertainment Co
Performance |
| Timeline |
| Live Nation Entertainment |
| Sphere Entertainment |
Live Nation and Sphere Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Nation and Sphere Entertainment
The main advantage of trading using opposite Live Nation and Sphere Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Nation position performs unexpectedly, Sphere Entertainment 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 Sphere Entertainment will offset losses from the drop in Sphere Entertainment'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 |
| Sphere Entertainment vs. Life Time Group | Sphere Entertainment vs. Daily Journal Corp | Sphere Entertainment vs. Pearson PLC ADR | Sphere Entertainment vs. Playtika Holding Corp |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |