Correlation Between Stagwell and Dolphin Entertainment
Can any of the company-specific risk be diversified away by investing in both Stagwell and Dolphin 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 Stagwell and Dolphin Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stagwell and Dolphin Entertainment, you can compare the effects of market volatilities on Stagwell and Dolphin 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 Stagwell with a short position of Dolphin Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stagwell and Dolphin Entertainment.
Diversification Opportunities for Stagwell and Dolphin Entertainment
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stagwell and Dolphin is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Stagwell and Dolphin Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dolphin Entertainment and Stagwell 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 Stagwell are associated (or correlated) with Dolphin Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dolphin Entertainment has no effect on the direction of Stagwell i.e., Stagwell and Dolphin Entertainment go up and down completely randomly.
Pair Corralation between Stagwell and Dolphin Entertainment
Given the investment horizon of 90 days Stagwell is expected to generate 0.76 times more return on investment than Dolphin Entertainment. However, Stagwell is 1.31 times less risky than Dolphin Entertainment. It trades about 0.4 of its potential returns per unit of risk. Dolphin Entertainment is currently generating about -0.17 per unit of risk. If you would invest 627.00 in Stagwell on August 27, 2024 and sell it today you would earn a total of 155.00 from holding Stagwell or generate 24.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stagwell vs. Dolphin Entertainment
Performance |
| Timeline |
| Stagwell |
| Dolphin Entertainment |
Stagwell and Dolphin Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stagwell and Dolphin Entertainment
The main advantage of trading using opposite Stagwell and Dolphin Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stagwell position performs unexpectedly, Dolphin 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 Dolphin Entertainment will offset losses from the drop in Dolphin Entertainment's long position.| Stagwell vs. Innovid Corp | Stagwell vs. Interpublic Group of | Stagwell vs. Cimpress NV | Stagwell vs. Criteo Sa |
| Dolphin Entertainment vs. Hall of Fame | Dolphin Entertainment vs. Wisekey International Holding | Dolphin Entertainment vs. Oriental Culture Holding |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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