Correlation Between Smurfit WestRock and Esports Entertainment
Can any of the company-specific risk be diversified away by investing in both Smurfit WestRock and Esports 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 Smurfit WestRock and Esports Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smurfit WestRock plc and Esports Entertainment Group, you can compare the effects of market volatilities on Smurfit WestRock and Esports 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 Smurfit WestRock with a short position of Esports Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smurfit WestRock and Esports Entertainment.
Diversification Opportunities for Smurfit WestRock and Esports Entertainment
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Smurfit and Esports is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Smurfit WestRock plc and Esports Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esports Entertainment and Smurfit WestRock 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 Smurfit WestRock plc are associated (or correlated) with Esports Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esports Entertainment has no effect on the direction of Smurfit WestRock i.e., Smurfit WestRock and Esports Entertainment go up and down completely randomly.
Pair Corralation between Smurfit WestRock and Esports Entertainment
If you would invest 3,734 in Smurfit WestRock plc on September 3, 2024 and sell it today you would earn a total of 1,777 from holding Smurfit WestRock plc or generate 47.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.56% |
| Values | Daily Returns |
Smurfit WestRock plc vs. Esports Entertainment Group
Performance |
| Timeline |
| Smurfit WestRock plc |
| Esports Entertainment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Smurfit WestRock and Esports Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smurfit WestRock and Esports Entertainment
The main advantage of trading using opposite Smurfit WestRock and Esports Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smurfit WestRock position performs unexpectedly, Esports 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 Esports Entertainment will offset losses from the drop in Esports Entertainment's long position.| Smurfit WestRock vs. Barings BDC | Smurfit WestRock vs. Femasys | Smurfit WestRock vs. KeyCorp | Smurfit WestRock vs. LithiumBank Resources Corp |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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