Correlation Between Golden Heaven and Sinclair Broadcast

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

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

Diversification Opportunities for Golden Heaven and Sinclair Broadcast

-0.23

Correlation Coefficient

Golden Heaven  Sinclair Broadcast

Very good diversification

The 3 months correlation between Golden and Sinclair is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Golden Heaven Group and Sinclair Broadcast Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinclair Broadcast and Golden Heaven 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 Golden Heaven Group 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 Golden Heaven i.e., Golden Heaven and Sinclair Broadcast go up and down completely randomly.

Pair Corralation between Golden Heaven and Sinclair Broadcast

Given the investment horizon of 90 days Golden Heaven Group is expected to generate 1.89 times more return on investment than Sinclair Broadcast. However, Golden Heaven is 1.89 times more volatile than Sinclair Broadcast Group. It trades about 0.49 of its potential returns per unit of risk. Sinclair Broadcast Group is currently generating about -0.22 per unit of risk. If you would invest  187.00  in Golden Heaven Group on October 11, 2024 and sell it today you would earn a total of  88.00  from holding Golden Heaven Group or generate 47.06% return on investment over 90 days.

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

Golden Heaven Group  vs.  Sinclair Broadcast Group

Golden Heaven Group

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Heaven Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical indicators, Golden Heaven reported solid returns over the last few months and may actually be approaching a breakup point.

Sinclair Broadcast

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Sinclair Broadcast Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Sinclair Broadcast is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Golden Heaven and Sinclair Broadcast

The main advantage of trading using opposite Golden Heaven and Sinclair Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Heaven 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 Golden Heaven Group 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.