Correlation Between Global Eagle and Disney
Can any of the company-specific risk be diversified away by investing in both Global Eagle and Disney 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 Global Eagle and Disney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Eagle Entertainment and Walt Disney, you can compare the effects of market volatilities on Global Eagle and Disney 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 Global Eagle with a short position of Disney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Eagle and Disney.
Diversification Opportunities for Global Eagle and Disney
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Global and Disney is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Eagle Entertainment and Walt Disney in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walt Disney and Global Eagle 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 Global Eagle Entertainment are associated (or correlated) with Disney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walt Disney has no effect on the direction of Global Eagle i.e., Global Eagle and Disney go up and down completely randomly.
Pair Corralation between Global Eagle and Disney
If you would invest 9,630 in Walt Disney on January 21, 2024 and sell it today you would earn a total of 1,631 from holding Walt Disney or generate 16.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Global Eagle Entertainment vs. Walt Disney
Performance |
Timeline |
Global Eagle Enterta |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walt Disney |
Global Eagle and Disney Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Global Eagle and Disney
The main advantage of trading using opposite Global Eagle and Disney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Eagle position performs unexpectedly, Disney 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 Disney will offset losses from the drop in Disney's long position.Global Eagle vs. Molson Coors Brewing | Global Eagle vs. Scandinavian Tobacco Group | Global Eagle vs. National CineMedia | Global Eagle vs. Ubisoft Entertainment |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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