Correlation Between United Parks and ANTA Sports
Can any of the company-specific risk be diversified away by investing in both United Parks and ANTA Sports 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 United Parks and ANTA Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Parks Resorts and ANTA Sports Products, you can compare the effects of market volatilities on United Parks and ANTA Sports 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 United Parks with a short position of ANTA Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Parks and ANTA Sports.
Diversification Opportunities for United Parks and ANTA Sports
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and ANTA is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding United Parks Resorts and ANTA Sports Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA Sports Products and United Parks 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 United Parks Resorts are associated (or correlated) with ANTA Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA Sports Products has no effect on the direction of United Parks i.e., United Parks and ANTA Sports go up and down completely randomly.
Pair Corralation between United Parks and ANTA Sports
Given the investment horizon of 90 days United Parks Resorts is expected to generate 0.77 times more return on investment than ANTA Sports. However, United Parks Resorts is 1.29 times less risky than ANTA Sports. It trades about 0.03 of its potential returns per unit of risk. ANTA Sports Products is currently generating about 0.02 per unit of risk. If you would invest 5,054 in United Parks Resorts on August 29, 2024 and sell it today you would earn a total of 669.00 from holding United Parks Resorts or generate 13.24% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
United Parks Resorts vs. ANTA Sports Products
Performance |
Timeline |
United Parks Resorts |
ANTA Sports Products |
United Parks and ANTA Sports Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with United Parks and ANTA Sports
The main advantage of trading using opposite United Parks and ANTA Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Parks position performs unexpectedly, ANTA Sports 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 ANTA Sports will offset losses from the drop in ANTA Sports' long position.United Parks vs. Park Ohio Holdings | United Parks vs. MYR Group | United Parks vs. Aris Water Solutions | United Parks vs. Kinetik Holdings |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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