Correlation Between Atresmedia and AcadeMedia
Can any of the company-specific risk be diversified away by investing in both Atresmedia and AcadeMedia 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 Atresmedia and AcadeMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atresmedia and AcadeMedia AB, you can compare the effects of market volatilities on Atresmedia and AcadeMedia 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 Atresmedia with a short position of AcadeMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atresmedia and AcadeMedia.
Diversification Opportunities for Atresmedia and AcadeMedia
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Atresmedia and AcadeMedia is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Atresmedia and AcadeMedia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AcadeMedia AB and Atresmedia 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 Atresmedia are associated (or correlated) with AcadeMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AcadeMedia AB has no effect on the direction of Atresmedia i.e., Atresmedia and AcadeMedia go up and down completely randomly.
Pair Corralation between Atresmedia and AcadeMedia
Assuming the 90 days trading horizon Atresmedia is expected to generate 0.76 times more return on investment than AcadeMedia. However, Atresmedia is 1.32 times less risky than AcadeMedia. It trades about 0.08 of its potential returns per unit of risk. AcadeMedia AB is currently generating about 0.06 per unit of risk. If you would invest 291.00 in Atresmedia on August 25, 2024 and sell it today you would earn a total of 158.00 from holding Atresmedia or generate 54.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Atresmedia vs. AcadeMedia AB
Performance |
| Timeline |
| Atresmedia |
| AcadeMedia AB |
Atresmedia and AcadeMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atresmedia and AcadeMedia
The main advantage of trading using opposite Atresmedia and AcadeMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atresmedia position performs unexpectedly, AcadeMedia 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 AcadeMedia will offset losses from the drop in AcadeMedia's long position.| Atresmedia vs. Samsung Electronics Co | Atresmedia vs. Samsung Electronics Co | Atresmedia vs. Hyundai Motor | Atresmedia vs. Toyota Motor Corp |
| AcadeMedia vs. Samsung Electronics Co | AcadeMedia vs. Samsung Electronics Co | AcadeMedia vs. Hyundai Motor | AcadeMedia vs. Toyota Motor Corp |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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