Correlation Between SeaWorld Entertainment and Escalade Incorporated
Can any of the company-specific risk be diversified away by investing in both SeaWorld Entertainment and Escalade Incorporated 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 SeaWorld Entertainment and Escalade Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SeaWorld Entertainment and Escalade Incorporated, you can compare the effects of market volatilities on SeaWorld Entertainment and Escalade Incorporated 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 SeaWorld Entertainment with a short position of Escalade Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of SeaWorld Entertainment and Escalade Incorporated.
Diversification Opportunities for SeaWorld Entertainment and Escalade Incorporated
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between SeaWorld and Escalade is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding SeaWorld Entertainment and Escalade Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Escalade Incorporated and SeaWorld Entertainment 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 SeaWorld Entertainment are associated (or correlated) with Escalade Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Escalade Incorporated has no effect on the direction of SeaWorld Entertainment i.e., SeaWorld Entertainment and Escalade Incorporated go up and down completely randomly.
Pair Corralation between SeaWorld Entertainment and Escalade Incorporated
If you would invest 1,354 in Escalade Incorporated on August 24, 2024 and sell it today you would earn a total of 161.00 from holding Escalade Incorporated or generate 11.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
SeaWorld Entertainment vs. Escalade Incorporated
Performance |
| Timeline |
| SeaWorld Entertainment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Escalade Incorporated |
SeaWorld Entertainment and Escalade Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SeaWorld Entertainment and Escalade Incorporated
The main advantage of trading using opposite SeaWorld Entertainment and Escalade Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SeaWorld Entertainment position performs unexpectedly, Escalade Incorporated 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 Escalade Incorporated will offset losses from the drop in Escalade Incorporated's long position.| SeaWorld Entertainment vs. JAKKS Pacific | SeaWorld Entertainment vs. OneSpaWorld Holdings | SeaWorld Entertainment vs. Clarus Corp | SeaWorld Entertainment vs. Six Flags Entertainment |
| Escalade Incorporated vs. Vista Outdoor | Escalade Incorporated vs. Six Flags Entertainment | Escalade Incorporated vs. Canlan Ice Sports | Escalade Incorporated vs. OneSpaWorld Holdings |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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