Correlation Between Thunderbird Entertainment and Spanish Broadcasting

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Can any of the company-specific risk be diversified away by investing in both Thunderbird Entertainment and Spanish Broadcasting 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 Thunderbird Entertainment and Spanish Broadcasting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thunderbird Entertainment Group and Spanish Broadcasting System, you can compare the effects of market volatilities on Thunderbird Entertainment and Spanish Broadcasting 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 Thunderbird Entertainment with a short position of Spanish Broadcasting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thunderbird Entertainment and Spanish Broadcasting.

Diversification Opportunities for Thunderbird Entertainment and Spanish Broadcasting

-0.06
  Correlation Coefficient

Good diversification

The 3 months correlation between Thunderbird and Spanish is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Thunderbird Entertainment Grou and Spanish Broadcasting System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spanish Broadcasting and Thunderbird Entertainment 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 Thunderbird Entertainment Group are associated (or correlated) with Spanish Broadcasting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spanish Broadcasting has no effect on the direction of Thunderbird Entertainment i.e., Thunderbird Entertainment and Spanish Broadcasting go up and down completely randomly.

Pair Corralation between Thunderbird Entertainment and Spanish Broadcasting

Assuming the 90 days horizon Thunderbird Entertainment Group is expected to generate 0.33 times more return on investment than Spanish Broadcasting. However, Thunderbird Entertainment Group is 3.07 times less risky than Spanish Broadcasting. It trades about -0.02 of its potential returns per unit of risk. Spanish Broadcasting System is currently generating about -0.02 per unit of risk. If you would invest  251.00  in Thunderbird Entertainment Group on October 7, 2024 and sell it today you would lose (127.00) from holding Thunderbird Entertainment Group or give up 50.6% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy3.63%
ValuesDaily Returns

Thunderbird Entertainment Grou  vs.  Spanish Broadcasting System

 Performance 
       Timeline  
Thunderbird Entertainment 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Thunderbird Entertainment Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
Spanish Broadcasting 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Spanish Broadcasting System has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Spanish Broadcasting is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Thunderbird Entertainment and Spanish Broadcasting Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Thunderbird Entertainment and Spanish Broadcasting

The main advantage of trading using opposite Thunderbird Entertainment and Spanish Broadcasting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thunderbird Entertainment position performs unexpectedly, Spanish Broadcasting 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 Spanish Broadcasting will offset losses from the drop in Spanish Broadcasting's long position.
The idea behind Thunderbird Entertainment Group and Spanish Broadcasting System 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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