Correlation Between Madison Square and Stewart Information
Can any of the company-specific risk be diversified away by investing in both Madison Square and Stewart Information 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 Madison Square and Stewart Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Madison Square Garden and Stewart Information Services, you can compare the effects of market volatilities on Madison Square and Stewart Information 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 Madison Square with a short position of Stewart Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Madison Square and Stewart Information.
Diversification Opportunities for Madison Square and Stewart Information
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Madison and Stewart is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Madison Square Garden and Stewart Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stewart Information and Madison Square 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 Madison Square Garden are associated (or correlated) with Stewart Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stewart Information has no effect on the direction of Madison Square i.e., Madison Square and Stewart Information go up and down completely randomly.
Pair Corralation between Madison Square and Stewart Information
Given the investment horizon of 90 days Madison Square Garden is expected to generate 0.84 times more return on investment than Stewart Information. However, Madison Square Garden is 1.2 times less risky than Stewart Information. It trades about 0.16 of its potential returns per unit of risk. Stewart Information Services is currently generating about 0.08 per unit of risk. If you would invest 19,578 in Madison Square Garden on September 1, 2025 and sell it today you would earn a total of 3,225 from holding Madison Square Garden or generate 16.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Madison Square Garden vs. Stewart Information Services
Performance |
| Timeline |
| Madison Square Garden |
| Stewart Information |
Madison Square and Stewart Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Madison Square and Stewart Information
The main advantage of trading using opposite Madison Square and Stewart Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Madison Square position performs unexpectedly, Stewart Information 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 Stewart Information will offset losses from the drop in Stewart Information's long position.| Madison Square vs. ERecord Management | Madison Square vs. Perfect Medical Health | Madison Square vs. Impax Asset Management | Madison Square vs. Motorcar Parts of |
| Stewart Information vs. Integrated Wellness Acquisition | Stewart Information vs. JD Sports Fashion | Stewart Information vs. National Healthcare Logistics | Stewart Information vs. Earthworks Entertainment |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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