Correlation Between Liberty Media and Foresight Group
Can any of the company-specific risk be diversified away by investing in both Liberty Media and Foresight Group 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 Liberty Media and Foresight Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Media Corp and Foresight Group Holdings, you can compare the effects of market volatilities on Liberty Media and Foresight Group 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 Liberty Media with a short position of Foresight Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Media and Foresight Group.
Diversification Opportunities for Liberty Media and Foresight Group
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Liberty and Foresight is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Media Corp and Foresight Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foresight Group Holdings and Liberty Media 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 Liberty Media Corp are associated (or correlated) with Foresight Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foresight Group Holdings has no effect on the direction of Liberty Media i.e., Liberty Media and Foresight Group go up and down completely randomly.
Pair Corralation between Liberty Media and Foresight Group
Assuming the 90 days trading horizon Liberty Media Corp is expected to generate 0.41 times more return on investment than Foresight Group. However, Liberty Media Corp is 2.45 times less risky than Foresight Group. It trades about -0.13 of its potential returns per unit of risk. Foresight Group Holdings is currently generating about -0.18 per unit of risk. If you would invest 8,505 in Liberty Media Corp on October 25, 2024 and sell it today you would lose (184.00) from holding Liberty Media Corp or give up 2.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liberty Media Corp vs. Foresight Group Holdings
Performance |
| Timeline |
| Liberty Media Corp |
| Foresight Group Holdings |
Liberty Media and Foresight Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Media and Foresight Group
The main advantage of trading using opposite Liberty Media and Foresight Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Media position performs unexpectedly, Foresight Group 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 Foresight Group will offset losses from the drop in Foresight Group's long position.| Liberty Media vs. Toyota Motor Corp | Liberty Media vs. SoftBank Group Corp | Liberty Media vs. OTP Bank Nyrt | Liberty Media vs. ONEOK Inc |
| Foresight Group vs. International Biotechnology Trust | Foresight Group vs. Verizon Communications | Foresight Group vs. Axway Software SA | Foresight Group vs. Telecom Italia SpA |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |