Correlation Between Sphere Entertainment and Amgen
Can any of the company-specific risk be diversified away by investing in both Sphere Entertainment and Amgen 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 Sphere Entertainment and Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sphere Entertainment Co and Amgen Inc, you can compare the effects of market volatilities on Sphere Entertainment and Amgen 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 Sphere Entertainment with a short position of Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere Entertainment and Amgen.
Diversification Opportunities for Sphere Entertainment and Amgen
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sphere and Amgen is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Sphere Entertainment Co and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc and Sphere 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 Sphere Entertainment Co are associated (or correlated) with Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Sphere Entertainment i.e., Sphere Entertainment and Amgen go up and down completely randomly.
Pair Corralation between Sphere Entertainment and Amgen
Given the investment horizon of 90 days Sphere Entertainment Co is expected to generate 1.71 times more return on investment than Amgen. However, Sphere Entertainment is 1.71 times more volatile than Amgen Inc. It trades about 0.31 of its potential returns per unit of risk. Amgen Inc is currently generating about 0.42 per unit of risk. If you would invest 4,151 in Sphere Entertainment Co on November 3, 2024 and sell it today you would earn a total of 528.00 from holding Sphere Entertainment Co or generate 12.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sphere Entertainment Co vs. Amgen Inc
Performance |
| Timeline |
| Sphere Entertainment |
| Amgen Inc |
Sphere Entertainment and Amgen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sphere Entertainment and Amgen
The main advantage of trading using opposite Sphere Entertainment and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere Entertainment position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.| Sphere Entertainment vs. Sonida Senior Living | Sphere Entertainment vs. Universal Music Group | Sphere Entertainment vs. NetEase | Sphere Entertainment vs. Jabil Circuit |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |