Correlation Between Live Nation and Intelbras

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

By analyzing existing cross correlation between Live Nation Entertainment, and Intelbras SA , you can compare the effects of market volatilities on Live Nation and Intelbras 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 Live Nation with a short position of Intelbras. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Intelbras.

Diversification Opportunities for Live Nation and Intelbras

-0.88

Correlation Coefficient

Live Nation  Intelbras

Pay attention - limited upside

The 3 months correlation between Live and Intelbras is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment, and Intelbras SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelbras SA and Live Nation 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 Live Nation Entertainment, are associated (or correlated) with Intelbras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelbras SA has no effect on the direction of Live Nation i.e., Live Nation and Intelbras go up and down completely randomly.

Pair Corralation between Live Nation and Intelbras

Assuming the 90 days trading horizon Live Nation Entertainment, is expected to under-perform the Intelbras. But the stock apears to be less risky and, when comparing its historical volatility, Live Nation Entertainment, is 2.06 times less risky than Intelbras. The stock trades about -0.01 of its potential returns per unit of risk. The Intelbras SA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,317  in Intelbras SA on October 23, 2024 and sell it today you would earn a total of  43.00  from holding Intelbras SA or generate 3.26% return on investment over 90 days.

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

Live Nation Entertainment,  vs.  Intelbras SA

Live Nation Entertai

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Live Nation Entertainment, are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Live Nation sustained solid returns over the last few months and may actually be approaching a breakup point.

Intelbras SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intelbras SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Live Nation and Intelbras

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

The idea behind Live Nation Entertainment, and Intelbras SA 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.