Correlation Between Sycamore Entmt and ORACLE

Can any of the company-specific risk be diversified away by investing in both Sycamore Entmt and ORACLE 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 ORACLE 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 ORACLE P 265, you can compare the effects of market volatilities on Sycamore Entmt and ORACLE 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 ORACLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sycamore Entmt and ORACLE.

Diversification Opportunities for Sycamore Entmt and ORACLE

0.2

Correlation Coefficient

Sycamore Entmt  ORACLE

Modest diversification

The 3 months correlation between Sycamore and ORACLE is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Sycamore Entmt Grp and ORACLE P 265 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ORACLE P 265 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 ORACLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ORACLE P 265 has no effect on the direction of Sycamore Entmt i.e., Sycamore Entmt and ORACLE go up and down completely randomly.

Pair Corralation between Sycamore Entmt and ORACLE

Given the investment horizon of 90 days Sycamore Entmt Grp is expected to generate 23.45 times more return on investment than ORACLE. However, Sycamore Entmt is 23.45 times more volatile than ORACLE P 265. It trades about 0.09 of its potential returns per unit of risk. ORACLE P 265 is currently generating about -0.14 per unit of risk. If you would invest  0.05  in Sycamore Entmt Grp on May 5, 2025 and sell it today you would earn a total of  0.01  from holding Sycamore Entmt Grp or generate 20.0% return on investment over 90 days.

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

Sycamore Entmt Grp  vs.  ORACLE P 265

Sycamore Entmt Grp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sycamore Entmt Grp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating technical and fundamental indicators, Sycamore Entmt demonstrated solid returns over the last few months and may actually be approaching a breakup point.

ORACLE P 265

Risk-Adjusted Performance

Very Weak

Over the last 90 days ORACLE P 265 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ORACLE is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sycamore Entmt and ORACLE

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

The idea behind Sycamore Entmt Grp and ORACLE P 265 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.