Correlation Between Sphere Entertainment and Network Media

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

By analyzing existing cross correlation between Sphere Entertainment Co and Network Media Group, you can compare the effects of market volatilities on Sphere Entertainment and Network Media 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 Sphere Entertainment with a short position of Network Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere Entertainment and Network Media.

Diversification Opportunities for Sphere Entertainment and Network Media

-0.69

Correlation Coefficient

Sphere Entertainment  Network Media

Excellent diversification

The 3 months correlation between Sphere and Network is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Sphere Entertainment Co and Network Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Network Media Group and Sphere 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 Sphere Entertainment Co are associated (or correlated) with Network Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Network Media Group has no effect on the direction of Sphere Entertainment i.e., Sphere Entertainment and Network Media go up and down completely randomly.

Pair Corralation between Sphere Entertainment and Network Media

Given the investment horizon of 90 days Sphere Entertainment Co is expected to generate 1.11 times more return on investment than Network Media. However, Sphere Entertainment is 1.11 times more volatile than Network Media Group. It trades about 0.33 of its potential returns per unit of risk. Network Media Group is currently generating about -0.07 per unit of risk. If you would invest  4,300  in Sphere Entertainment Co on August 27, 2025 and sell it today you would earn a total of  3,879  from holding Sphere Entertainment Co or generate 90.21% return on investment over 90 days.

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

Sphere Entertainment Co  vs.  Network Media Group

Sphere Entertainment

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Sphere Entertainment Co are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady technical indicators, Sphere Entertainment reported solid returns over the last few months and may actually be approaching a breakup point.

Network Media Group

Risk-Adjusted Performance

Weakest

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

Pair Trading with Sphere Entertainment and Network Media

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

The idea behind Sphere Entertainment Co and Network Media Group 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.

Check out your portfolio center.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.