Correlation Between Warner Bros and Atari SA
Can any of the company-specific risk be diversified away by investing in both Warner Bros and Atari SA 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 Warner Bros and Atari SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Warner Bros Discovery and Atari SA, you can compare the effects of market volatilities on Warner Bros and Atari SA 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 Warner Bros with a short position of Atari SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Warner Bros and Atari SA.
Diversification Opportunities for Warner Bros and Atari SA
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Warner and Atari is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Warner Bros Discovery and Atari SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atari SA and Warner Bros 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 Warner Bros Discovery are associated (or correlated) with Atari SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atari SA has no effect on the direction of Warner Bros i.e., Warner Bros and Atari SA go up and down completely randomly.
Pair Corralation between Warner Bros and Atari SA
Considering the 90-day investment horizon Warner Bros Discovery is expected to generate 0.46 times more return on investment than Atari SA. However, Warner Bros Discovery is 2.18 times less risky than Atari SA. It trades about 0.17 of its potential returns per unit of risk. Atari SA is currently generating about 0.06 per unit of risk. If you would invest 825.00 in Warner Bros Discovery on August 30, 2024 and sell it today you would earn a total of 186.00 from holding Warner Bros Discovery or generate 22.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Warner Bros Discovery vs. Atari SA
Performance |
| Timeline |
| Warner Bros Discovery |
| Atari SA |
Warner Bros and Atari SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Warner Bros and Atari SA
The main advantage of trading using opposite Warner Bros and Atari SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Warner Bros position performs unexpectedly, Atari SA 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 Atari SA will offset losses from the drop in Atari SA's long position.| Warner Bros vs. Walt Disney | Warner Bros vs. Roku Inc | Warner Bros vs. Netflix | Warner Bros vs. Paramount Global Class |
| Atari SA vs. ImagineAR | Atari SA vs. Fandom Sports Media | Atari SA vs. Image Protect | Atari SA vs. Coinsilium Group |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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