Correlation Between Sphere Entertainment and Kinetik Holdings
Can any of the company-specific risk be diversified away by investing in both Sphere Entertainment and Kinetik Holdings 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 Kinetik Holdings 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 Kinetik Holdings, you can compare the effects of market volatilities on Sphere Entertainment and Kinetik Holdings 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 Kinetik Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere Entertainment and Kinetik Holdings.
Diversification Opportunities for Sphere Entertainment and Kinetik Holdings
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sphere and Kinetik is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Sphere Entertainment Co and Kinetik Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetik Holdings 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 Kinetik Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetik Holdings has no effect on the direction of Sphere Entertainment i.e., Sphere Entertainment and Kinetik Holdings go up and down completely randomly.
Pair Corralation between Sphere Entertainment and Kinetik Holdings
Given the investment horizon of 90 days Sphere Entertainment Co is expected to under-perform the Kinetik Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Sphere Entertainment Co is 1.07 times less risky than Kinetik Holdings. The stock trades about -0.03 of its potential returns per unit of risk. The Kinetik Holdings is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 4,776 in Kinetik Holdings on September 2, 2024 and sell it today you would earn a total of 1,126 from holding Kinetik Holdings or generate 23.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sphere Entertainment Co vs. Kinetik Holdings
Performance |
| Timeline |
| Sphere Entertainment |
| Kinetik Holdings |
Sphere Entertainment and Kinetik Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sphere Entertainment and Kinetik Holdings
The main advantage of trading using opposite Sphere Entertainment and Kinetik Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere Entertainment position performs unexpectedly, Kinetik Holdings 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 Kinetik Holdings will offset losses from the drop in Kinetik Holdings' long position.| Sphere Entertainment vs. Zane Interactive Publishing | Sphere Entertainment vs. Sable Offshore Corp | Sphere Entertainment vs. AMREP | Sphere Entertainment vs. Coursera |
| Kinetik Holdings vs. Western Midstream Partners | Kinetik Holdings vs. DT Midstream | Kinetik Holdings vs. MPLX LP | Kinetik Holdings vs. Hess Midstream Partners |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stocks Directory Find actively traded stocks across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |