Correlation Between Alliance Data and Zinc Media
Can any of the company-specific risk be diversified away by investing in both Alliance Data and Zinc 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 Alliance Data and Zinc Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliance Data Systems and Zinc Media Group, you can compare the effects of market volatilities on Alliance Data and Zinc 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 Alliance Data with a short position of Zinc Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliance Data and Zinc Media.
Diversification Opportunities for Alliance Data and Zinc Media
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alliance and Zinc is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Alliance Data Systems and Zinc Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zinc Media Group and Alliance Data 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 Alliance Data Systems are associated (or correlated) with Zinc Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zinc Media Group has no effect on the direction of Alliance Data i.e., Alliance Data and Zinc Media go up and down completely randomly.
Pair Corralation between Alliance Data and Zinc Media
Assuming the 90 days trading horizon Alliance Data is expected to generate 9.45 times less return on investment than Zinc Media. In addition to that, Alliance Data is 1.74 times more volatile than Zinc Media Group. It trades about 0.02 of its total potential returns per unit of risk. Zinc Media Group is currently generating about 0.3 per unit of volatility. If you would invest 5,650 in Zinc Media Group on November 6, 2024 and sell it today you would earn a total of 550.00 from holding Zinc Media Group or generate 9.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Alliance Data Systems vs. Zinc Media Group
Performance |
| Timeline |
| Alliance Data Systems |
| Zinc Media Group |
Alliance Data and Zinc Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliance Data and Zinc Media
The main advantage of trading using opposite Alliance Data and Zinc Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliance Data position performs unexpectedly, Zinc 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 Zinc Media will offset losses from the drop in Zinc Media's long position.| Alliance Data vs. Atalaya Mining | Alliance Data vs. Morgan Advanced Materials | Alliance Data vs. Hecla Mining Co | Alliance Data vs. Coeur Mining |
| Zinc Media vs. International Consolidated Airlines | Zinc Media vs. Gaztransport et Technigaz | Zinc Media vs. Kinnevik Investment AB | Zinc Media vs. United Airlines Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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