Correlation Between LiveOne and Sinclair Broadcast

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

By analyzing existing cross correlation between LiveOne and Sinclair Broadcast Group, you can compare the effects of market volatilities on LiveOne and Sinclair Broadcast 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 LiveOne with a short position of Sinclair Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of LiveOne and Sinclair Broadcast.

Diversification Opportunities for LiveOne and Sinclair Broadcast

-0.27

Correlation Coefficient

LiveOne  Sinclair Broadcast

Very good diversification

The 3 months correlation between LiveOne and Sinclair is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding LiveOne and Sinclair Broadcast Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinclair Broadcast and LiveOne 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 LiveOne are associated (or correlated) with Sinclair Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinclair Broadcast has no effect on the direction of LiveOne i.e., LiveOne and Sinclair Broadcast go up and down completely randomly.

Pair Corralation between LiveOne and Sinclair Broadcast

Considering the 90-day investment horizon LiveOne is expected to generate 3.16 times more return on investment than Sinclair Broadcast. However, LiveOne is 3.16 times more volatile than Sinclair Broadcast Group. It trades about 0.04 of its potential returns per unit of risk. Sinclair Broadcast Group is currently generating about 0.1 per unit of risk. If you would invest  120.00  in LiveOne on September 22, 2024 and sell it today you would earn a total of  2.00  from holding LiveOne or generate 1.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

LiveOne  vs.  Sinclair Broadcast Group

LiveOne

Risk-Adjusted Performance

3 of 100

Weak

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

Sinclair Broadcast

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sinclair Broadcast Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical and fundamental indicators, Sinclair Broadcast demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LiveOne and Sinclair Broadcast

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

The idea behind LiveOne and Sinclair Broadcast Group 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .