Correlation Between Atlanta Braves and Omnicom

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

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

Diversification Opportunities for Atlanta Braves and Omnicom

-0.25

Correlation Coefficient

Atlanta Braves  Omnicom

Very good diversification

The 3 months correlation between Atlanta and Omnicom is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Atlanta Braves Holdings, and Omnicom Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omnicom Group and Atlanta Braves 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 Atlanta Braves Holdings, are associated (or correlated) with Omnicom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omnicom Group has no effect on the direction of Atlanta Braves i.e., Atlanta Braves and Omnicom go up and down completely randomly.

Pair Corralation between Atlanta Braves and Omnicom

Assuming the 90 days horizon Atlanta Braves Holdings, is expected to generate 0.84 times more return on investment than Omnicom. However, Atlanta Braves Holdings, is 1.2 times less risky than Omnicom. It trades about 0.14 of its potential returns per unit of risk. Omnicom Group is currently generating about -0.07 per unit of risk. If you would invest  4,030  in Atlanta Braves Holdings, on December 30, 2024 and sell it today you would earn a total of  376.00  from holding Atlanta Braves Holdings, or generate 9.33% return on investment over 90 days.

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

Atlanta Braves Holdings,  vs.  Omnicom Group

Atlanta Braves Holdings,

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Atlanta Braves Holdings, are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Atlanta Braves may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Omnicom Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Omnicom Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Omnicom is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Atlanta Braves and Omnicom

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

The idea behind Atlanta Braves Holdings, and Omnicom 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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.