Correlation Between Evolution Mining and Live Nation
Can any of the company-specific risk be diversified away by investing in both Evolution Mining and Live Nation 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 Evolution Mining and Live Nation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolution Mining Limited and Live Nation Entertainment, you can compare the effects of market volatilities on Evolution Mining and Live Nation 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 Evolution Mining with a short position of Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Mining and Live Nation.
Diversification Opportunities for Evolution Mining and Live Nation
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Evolution and Live is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Mining Limited and Live Nation Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Nation Entertainment and Evolution Mining 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 Evolution Mining Limited are associated (or correlated) with Live Nation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Nation Entertainment has no effect on the direction of Evolution Mining i.e., Evolution Mining and Live Nation go up and down completely randomly.
Pair Corralation between Evolution Mining and Live Nation
Assuming the 90 days horizon Evolution Mining is expected to generate 1.01 times less return on investment than Live Nation. In addition to that, Evolution Mining is 1.48 times more volatile than Live Nation Entertainment. It trades about 0.07 of its total potential returns per unit of risk. Live Nation Entertainment is currently generating about 0.1 per unit of volatility. If you would invest 8,500 in Live Nation Entertainment on September 14, 2024 and sell it today you would earn a total of 4,170 from holding Live Nation Entertainment or generate 49.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolution Mining Limited vs. Live Nation Entertainment
Performance |
| Timeline |
| Evolution Mining |
| Live Nation Entertainment |
Evolution Mining and Live Nation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolution Mining and Live Nation
The main advantage of trading using opposite Evolution Mining and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolution Mining position performs unexpectedly, Live Nation 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 Live Nation will offset losses from the drop in Live Nation's long position.| Evolution Mining vs. Mobilezone Holding AG | Evolution Mining vs. Take Two Interactive Software | Evolution Mining vs. Gamma Communications plc | Evolution Mining vs. Shenandoah Telecommunications |
| Live Nation vs. National Retail Properties | Live Nation vs. Retail Estates NV | Live Nation vs. Evolution Mining Limited | Live Nation vs. SERI INDUSTRIAL EO |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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