Correlation Between Sonos and SkyCity Entertainment
Can any of the company-specific risk be diversified away by investing in both Sonos and SkyCity Entertainment 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 Sonos and SkyCity Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonos Inc and SkyCity Entertainment Group, you can compare the effects of market volatilities on Sonos and SkyCity Entertainment 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 Sonos with a short position of SkyCity Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonos and SkyCity Entertainment.
Diversification Opportunities for Sonos and SkyCity Entertainment
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sonos and SkyCity is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Sonos Inc and SkyCity Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SkyCity Entertainment and Sonos 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 Sonos Inc are associated (or correlated) with SkyCity Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SkyCity Entertainment has no effect on the direction of Sonos i.e., Sonos and SkyCity Entertainment go up and down completely randomly.
Pair Corralation between Sonos and SkyCity Entertainment
Given the investment horizon of 90 days Sonos Inc is expected to generate 0.93 times more return on investment than SkyCity Entertainment. However, Sonos Inc is 1.07 times less risky than SkyCity Entertainment. It trades about -0.02 of its potential returns per unit of risk. SkyCity Entertainment Group is currently generating about -0.05 per unit of risk. If you would invest 2,121 in Sonos Inc on November 2, 2024 and sell it today you would lose (742.00) from holding Sonos Inc or give up 34.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 69.23% |
| Values | Daily Returns |
Sonos Inc vs. SkyCity Entertainment Group
Performance |
| Timeline |
| Sonos Inc |
| SkyCity Entertainment |
Sonos and SkyCity Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonos and SkyCity Entertainment
The main advantage of trading using opposite Sonos and SkyCity Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonos position performs unexpectedly, SkyCity Entertainment 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 SkyCity Entertainment will offset losses from the drop in SkyCity Entertainment's long position.| Sonos vs. LG Display Co | Sonos vs. Zepp Health Corp | Sonos vs. VOXX International | Sonos vs. Samsung Electronics Co |
| SkyCity Entertainment vs. Nagacorp | SkyCity Entertainment vs. Wynn Macau | SkyCity Entertainment vs. MGM China Holdings | SkyCity Entertainment vs. Table Trac |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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