Correlation Between Maxx Sports and Atlanta Braves

Can any of the company-specific risk be diversified away by investing in both Maxx Sports and Atlanta Braves 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 Maxx Sports and Atlanta Braves into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Maxx Sports TV and Atlanta Braves Holdings,, you can compare the effects of market volatilities on Maxx Sports and Atlanta Braves 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 Maxx Sports with a short position of Atlanta Braves. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxx Sports and Atlanta Braves.

Diversification Opportunities for Maxx Sports and Atlanta Braves

-0.38

Correlation Coefficient

Maxx Sports  Atlanta Braves

Very good diversification

The 3 months correlation between Maxx and Atlanta is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Maxx Sports TV and Atlanta Braves Holdings, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlanta Braves Holdings, and Maxx Sports 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 Maxx Sports TV are associated (or correlated) with Atlanta Braves. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlanta Braves Holdings, has no effect on the direction of Maxx Sports i.e., Maxx Sports and Atlanta Braves go up and down completely randomly.

Pair Corralation between Maxx Sports and Atlanta Braves

Given the investment horizon of 90 days Maxx Sports TV is expected to generate 16.21 times more return on investment than Atlanta Braves. However, Maxx Sports is 16.21 times more volatile than Atlanta Braves Holdings,. It trades about 0.04 of its potential returns per unit of risk. Atlanta Braves Holdings, is currently generating about -0.04 per unit of risk. If you would invest  4.00  in Maxx Sports TV on September 4, 2024 and sell it today you would lose (1.00) from holding Maxx Sports TV or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Maxx Sports TV  vs.  Atlanta Braves Holdings,

Maxx Sports TV

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Maxx Sports TV are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Maxx Sports showed solid returns over the last few months and may actually be approaching a breakup point.

Atlanta Braves Holdings,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atlanta Braves Holdings, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Atlanta Braves is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Maxx Sports and Atlanta Braves

The main advantage of trading using opposite Maxx Sports and Atlanta Braves positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxx Sports position performs unexpectedly, Atlanta Braves 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 Atlanta Braves will offset losses from the drop in Atlanta Braves' long position.

The idea behind Maxx Sports TV and Atlanta Braves Holdings, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.