Correlation Between SPORT LISBOA and Live Nation
Can any of the company-specific risk be diversified away by investing in both SPORT LISBOA 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 SPORT LISBOA and Live Nation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPORT LISBOA E and Live Nation Entertainment, you can compare the effects of market volatilities on SPORT LISBOA 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 SPORT LISBOA with a short position of Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPORT LISBOA and Live Nation.
Diversification Opportunities for SPORT LISBOA and Live Nation
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between SPORT and Live is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding SPORT LISBOA E 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 SPORT LISBOA 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 SPORT LISBOA E 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 SPORT LISBOA i.e., SPORT LISBOA and Live Nation go up and down completely randomly.
Pair Corralation between SPORT LISBOA and Live Nation
Assuming the 90 days horizon SPORT LISBOA E is expected to generate 2.87 times more return on investment than Live Nation. However, SPORT LISBOA is 2.87 times more volatile than Live Nation Entertainment. It trades about -0.02 of its potential returns per unit of risk. Live Nation Entertainment is currently generating about -0.27 per unit of risk. If you would invest 313.00 in SPORT LISBOA E on October 16, 2024 and sell it today you would lose (4.00) from holding SPORT LISBOA E or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPORT LISBOA E vs. Live Nation Entertainment
Performance |
| Timeline |
| SPORT LISBOA E |
| Live Nation Entertainment |
SPORT LISBOA and Live Nation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPORT LISBOA and Live Nation
The main advantage of trading using opposite SPORT LISBOA and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPORT LISBOA 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.| SPORT LISBOA vs. FUYO GENERAL LEASE | SPORT LISBOA vs. ANGANG STEEL H | SPORT LISBOA vs. ALGOMA STEEL GROUP | SPORT LISBOA vs. DONGJIANG ENVIRONMENTAL H |
| Live Nation vs. SOEDER SPORTFISKE AB | Live Nation vs. SPORT LISBOA E | Live Nation vs. Fukuyama Transporting Co | Live Nation vs. Shenandoah Telecommunications |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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