Correlation Between Live Nation and Scienjoy Holding

Can any of the company-specific risk be diversified away by investing in both Live Nation and Scienjoy Holding 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 Scienjoy Holding 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 Scienjoy Holding Corp, you can compare the effects of market volatilities on Live Nation and Scienjoy Holding 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 Scienjoy Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Nation and Scienjoy Holding.

Diversification Opportunities for Live Nation and Scienjoy Holding

0.24

Correlation Coefficient

Live Nation  Scienjoy Holding

Modest diversification

The 3 months correlation between Live and Scienjoy is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Live Nation Entertainment and Scienjoy Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scienjoy Holding Corp 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 Scienjoy Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scienjoy Holding Corp has no effect on the direction of Live Nation i.e., Live Nation and Scienjoy Holding go up and down completely randomly.

Pair Corralation between Live Nation and Scienjoy Holding

Considering the 90-day investment horizon Live Nation Entertainment is expected to under-perform the Scienjoy Holding. But the stock apears to be less risky and, when comparing its historical volatility, Live Nation Entertainment is 7.52 times less risky than Scienjoy Holding. The stock trades about -0.19 of its potential returns per unit of risk. The Scienjoy Holding Corp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  93.00  in Scienjoy Holding Corp on September 29, 2024 and sell it today you would earn a total of  11.00  from holding Scienjoy Holding Corp or generate 11.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Live Nation Entertainment  vs.  Scienjoy Holding Corp

Live Nation Entertainment

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Live Nation Entertainment are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, Live Nation showed solid returns over the last few months and may actually be approaching a breakup point.

Scienjoy Holding Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Scienjoy Holding Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady forward-looking indicators, Scienjoy Holding revealed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Live Nation and Scienjoy Holding

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

The idea behind Live Nation Entertainment and Scienjoy Holding Corp 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.