Correlation Between Array Digital and LiveOne

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

By analyzing existing cross correlation between Array Digital Infrastructure, and LiveOne, you can compare the effects of market volatilities on Array Digital and LiveOne 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 Array Digital with a short position of LiveOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Array Digital and LiveOne.

Diversification Opportunities for Array Digital and LiveOne

-0.84

Correlation Coefficient

Array Digital  LiveOne

Pay attention - limited upside

The 3 months correlation between Array and LiveOne is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Array Digital Infrastructure, and LiveOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiveOne and Array Digital 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 Array Digital Infrastructure, are associated (or correlated) with LiveOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiveOne has no effect on the direction of Array Digital i.e., Array Digital and LiveOne go up and down completely randomly.

Pair Corralation between Array Digital and LiveOne

Allowing for the 90-day total investment horizon Array Digital Infrastructure, is expected to generate 0.4 times more return on investment than LiveOne. However, Array Digital Infrastructure, is 2.52 times less risky than LiveOne. It trades about 0.2 of its potential returns per unit of risk. LiveOne is currently generating about -0.06 per unit of risk. If you would invest  4,413  in Array Digital Infrastructure, on May 26, 2025 and sell it today you would earn a total of  1,078  from holding Array Digital Infrastructure, or generate 24.43% return on investment over 90 days.

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

Array Digital Infrastructure,  vs.  LiveOne

Array Digital Infras

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Array Digital Infrastructure, are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, Array Digital exhibited solid returns over the last few months and may actually be approaching a breakup point.

LiveOne

Risk-Adjusted Performance

Weakest

Over the last 90 days LiveOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Array Digital and LiveOne

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

The idea behind Array Digital Infrastructure, and LiveOne 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.