Correlation Between Vasta Platform and Sonos
Can any of the company-specific risk be diversified away by investing in both Vasta Platform and Sonos 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 Vasta Platform and Sonos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vasta Platform and Sonos Inc, you can compare the effects of market volatilities on Vasta Platform and Sonos 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 Vasta Platform with a short position of Sonos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vasta Platform and Sonos.
Diversification Opportunities for Vasta Platform and Sonos
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vasta and Sonos is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Vasta Platform and Sonos Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonos Inc and Vasta Platform 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 Vasta Platform are associated (or correlated) with Sonos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonos Inc has no effect on the direction of Vasta Platform i.e., Vasta Platform and Sonos go up and down completely randomly.
Pair Corralation between Vasta Platform and Sonos
Given the investment horizon of 90 days Vasta Platform is expected to generate 1.12 times more return on investment than Sonos. However, Vasta Platform is 1.12 times more volatile than Sonos Inc. It trades about 0.47 of its potential returns per unit of risk. Sonos Inc is currently generating about 0.05 per unit of risk. If you would invest 230.00 in Vasta Platform on November 9, 2024 and sell it today you would earn a total of 58.00 from holding Vasta Platform or generate 25.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vasta Platform vs. Sonos Inc
Performance |
| Timeline |
| Vasta Platform |
| Sonos Inc |
Vasta Platform and Sonos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vasta Platform and Sonos
The main advantage of trading using opposite Vasta Platform and Sonos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vasta Platform position performs unexpectedly, Sonos 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 Sonos will offset losses from the drop in Sonos' long position.| Vasta Platform vs. Strategic Education | Vasta Platform vs. Grand Canyon Education | Vasta Platform vs. Universal Technical Institute | Vasta Platform vs. Laureate Education |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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