Correlation Between Madison Square and Plby
Can any of the company-specific risk be diversified away by investing in both Madison Square and Plby 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 Madison Square and Plby into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Madison Square Garden and Plby Group, you can compare the effects of market volatilities on Madison Square and Plby 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 Madison Square with a short position of Plby. Check out your portfolio center. Please also check ongoing floating volatility patterns of Madison Square and Plby.
Diversification Opportunities for Madison Square and Plby
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Madison and Plby is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Madison Square Garden and Plby Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plby Group and Madison Square 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 Madison Square Garden are associated (or correlated) with Plby. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plby Group has no effect on the direction of Madison Square i.e., Madison Square and Plby go up and down completely randomly.
Pair Corralation between Madison Square and Plby
Given the investment horizon of 90 days Madison Square is expected to generate 5.53 times less return on investment than Plby. But when comparing it to its historical volatility, Madison Square Garden is 3.07 times less risky than Plby. It trades about 0.01 of its potential returns per unit of risk. Plby Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 177.00 in Plby Group on August 31, 2024 and sell it today you would lose (39.00) from holding Plby Group or give up 22.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Madison Square Garden vs. Plby Group
Performance |
| Timeline |
| Madison Square Garden |
| Plby Group |
Madison Square and Plby Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Madison Square and Plby
The main advantage of trading using opposite Madison Square and Plby positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Madison Square position performs unexpectedly, Plby 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 Plby will offset losses from the drop in Plby's long position.| Madison Square vs. Madison Square Garden | Madison Square vs. Graham Holdings Co | Madison Square vs. Atlanta Braves Holdings, | Madison Square vs. Live Nation Entertainment |
| Plby vs. Purecycle Technologies Holdings | Plby vs. Dolphin Entertainment | Plby vs. Hall of Fame | Plby vs. Funko Inc |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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