Correlation Between Sports Entertainment and MA Financial
Can any of the company-specific risk be diversified away by investing in both Sports Entertainment and MA Financial 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 Sports Entertainment and MA Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sports Entertainment Group and MA Financial Group, you can compare the effects of market volatilities on Sports Entertainment and MA Financial 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 Sports Entertainment with a short position of MA Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sports Entertainment and MA Financial.
Diversification Opportunities for Sports Entertainment and MA Financial
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sports and MAF is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sports Entertainment Group and MA Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MA Financial Group and Sports 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 Sports Entertainment Group are associated (or correlated) with MA Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MA Financial Group has no effect on the direction of Sports Entertainment i.e., Sports Entertainment and MA Financial go up and down completely randomly.
Pair Corralation between Sports Entertainment and MA Financial
Assuming the 90 days trading horizon Sports Entertainment Group is expected to generate 2.09 times more return on investment than MA Financial. However, Sports Entertainment is 2.09 times more volatile than MA Financial Group. It trades about 0.02 of its potential returns per unit of risk. MA Financial Group is currently generating about 0.04 per unit of risk. If you would invest 21.00 in Sports Entertainment Group on October 25, 2024 and sell it today you would earn a total of 0.00 from holding Sports Entertainment Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Sports Entertainment Group vs. MA Financial Group
Performance |
| Timeline |
| Sports Entertainment |
| MA Financial Group |
Sports Entertainment and MA Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sports Entertainment and MA Financial
The main advantage of trading using opposite Sports Entertainment and MA Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sports Entertainment position performs unexpectedly, MA Financial 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 MA Financial will offset losses from the drop in MA Financial's long position.| Sports Entertainment vs. Gold Road Resources | Sports Entertainment vs. Aeon Metals | Sports Entertainment vs. Falcon Metals | Sports Entertainment vs. Iron Road |
| MA Financial vs. My Foodie Box | MA Financial vs. ABACUS STORAGE KING | MA Financial vs. Medical Developments International | MA Financial vs. Galena Mining |
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 Stocks Directory module to find actively traded stocks across global markets.
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