Correlation Between Sycamore Entmt and Bank Central

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

By analyzing existing cross correlation between Sycamore Entmt Grp and Bank Central Asia, you can compare the effects of market volatilities on Sycamore Entmt and Bank Central 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 Sycamore Entmt with a short position of Bank Central. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sycamore Entmt and Bank Central.

Diversification Opportunities for Sycamore Entmt and Bank Central

-0.66

Correlation Coefficient

Sycamore Entmt  Bank Central

Excellent diversification

The 3 months correlation between Sycamore and Bank is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sycamore Entmt Grp and Bank Central Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Central Asia and Sycamore Entmt 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 Sycamore Entmt Grp are associated (or correlated) with Bank Central. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Central Asia has no effect on the direction of Sycamore Entmt i.e., Sycamore Entmt and Bank Central go up and down completely randomly.

Pair Corralation between Sycamore Entmt and Bank Central

Given the investment horizon of 90 days Sycamore Entmt Grp is expected to generate 6.29 times more return on investment than Bank Central. However, Sycamore Entmt is 6.29 times more volatile than Bank Central Asia. It trades about 0.03 of its potential returns per unit of risk. Bank Central Asia is currently generating about 0.06 per unit of risk. If you would invest  0.19  in Sycamore Entmt Grp on September 19, 2024 and sell it today you would lose (0.01) from holding Sycamore Entmt Grp or give up 5.26% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Sycamore Entmt Grp  vs.  Bank Central Asia

Sycamore Entmt Grp

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sycamore Entmt Grp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain technical and fundamental indicators, Sycamore Entmt demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Bank Central Asia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bank Central Asia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Sycamore Entmt and Bank Central

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

The idea behind Sycamore Entmt Grp and Bank Central Asia 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 Transaction History module to view history of all your transactions and understand their impact on performance.