Correlation Between PARKEN Sport and Sydinv Europa

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

By analyzing existing cross correlation between PARKEN Sport Entertainment and Sydinv Europa Value, you can compare the effects of market volatilities on PARKEN Sport and Sydinv Europa 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 PARKEN Sport with a short position of Sydinv Europa. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Sydinv Europa.

Diversification Opportunities for PARKEN Sport and Sydinv Europa

0.7

Correlation Coefficient

PARKEN Sport  Sydinv Europa

Poor diversification

The 3 months correlation between PARKEN and Sydinv is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Sydinv Europa Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sydinv Europa Value and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with Sydinv Europa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sydinv Europa Value has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Sydinv Europa go up and down completely randomly.

Pair Corralation between PARKEN Sport and Sydinv Europa

Assuming the 90 days trading horizon PARKEN Sport Entertainment is expected to generate 1.85 times more return on investment than Sydinv Europa. However, PARKEN Sport is 1.85 times more volatile than Sydinv Europa Value. It trades about 0.07 of its potential returns per unit of risk. Sydinv Europa Value is currently generating about 0.09 per unit of risk. If you would invest  9,142  in PARKEN Sport Entertainment on March 30, 2025 and sell it today you would earn a total of  6,408  from holding PARKEN Sport Entertainment or generate 70.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	47.37%
Values	Daily Returns

PARKEN Sport Entertainment  vs.  Sydinv Europa Value

PARKEN Sport Enterta

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, PARKEN Sport sustained solid returns over the last few months and may actually be approaching a breakup point.

Sydinv Europa Value

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sydinv Europa Value are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Sydinv Europa is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PARKEN Sport and Sydinv Europa

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

The idea behind PARKEN Sport Entertainment and Sydinv Europa Value 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.