Correlation Between ServiceNow and Live Ventures
Can any of the company-specific risk be diversified away by investing in both ServiceNow and Live Ventures 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 ServiceNow and Live Ventures into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ServiceNow and Live Ventures, you can compare the effects of market volatilities on ServiceNow and Live Ventures 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 ServiceNow with a short position of Live Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of ServiceNow and Live Ventures.
Diversification Opportunities for ServiceNow and Live Ventures
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ServiceNow and Live is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding ServiceNow and Live Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Ventures and ServiceNow 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 ServiceNow are associated (or correlated) with Live Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Ventures has no effect on the direction of ServiceNow i.e., ServiceNow and Live Ventures go up and down completely randomly.
Pair Corralation between ServiceNow and Live Ventures
Considering the 90-day investment horizon ServiceNow is expected to generate 0.55 times more return on investment than Live Ventures. However, ServiceNow is 1.81 times less risky than Live Ventures. It trades about 0.18 of its potential returns per unit of risk. Live Ventures is currently generating about -0.18 per unit of risk. If you would invest 65,693 in ServiceNow on August 29, 2024 and sell it today you would earn a total of 38,447 from holding ServiceNow or generate 58.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ServiceNow vs. Live Ventures
Performance |
| Timeline |
| ServiceNow |
| Live Ventures |
ServiceNow and Live Ventures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ServiceNow and Live Ventures
The main advantage of trading using opposite ServiceNow and Live Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ServiceNow position performs unexpectedly, Live Ventures 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 Ventures will offset losses from the drop in Live Ventures' long position.| ServiceNow vs. Autodesk | ServiceNow vs. Intuit Inc | ServiceNow vs. Zoom Video Communications | ServiceNow vs. Snowflake |
| Live Ventures vs. Arhaus Inc | Live Ventures vs. Floor Decor Holdings | Live Ventures vs. Haverty Furniture Companies | Live Ventures vs. Kingfisher plc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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