Correlation Between AcadeMedia and G5 Entertainment
Can any of the company-specific risk be diversified away by investing in both AcadeMedia and G5 Entertainment 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 AcadeMedia and G5 Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AcadeMedia AB and G5 Entertainment AB, you can compare the effects of market volatilities on AcadeMedia and G5 Entertainment 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 AcadeMedia with a short position of G5 Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of AcadeMedia and G5 Entertainment.
Diversification Opportunities for AcadeMedia and G5 Entertainment
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AcadeMedia and 0QUS is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding AcadeMedia AB and G5 Entertainment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G5 Entertainment and AcadeMedia 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 AcadeMedia AB are associated (or correlated) with G5 Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G5 Entertainment has no effect on the direction of AcadeMedia i.e., AcadeMedia and G5 Entertainment go up and down completely randomly.
Pair Corralation between AcadeMedia and G5 Entertainment
Assuming the 90 days trading horizon AcadeMedia is expected to generate 11.41 times less return on investment than G5 Entertainment. But when comparing it to its historical volatility, AcadeMedia AB is 1.56 times less risky than G5 Entertainment. It trades about 0.03 of its potential returns per unit of risk. G5 Entertainment AB is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 11,800 in G5 Entertainment AB on November 5, 2024 and sell it today you would earn a total of 1,200 from holding G5 Entertainment AB or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AcadeMedia AB vs. G5 Entertainment AB
Performance |
| Timeline |
| AcadeMedia AB |
| G5 Entertainment |
AcadeMedia and G5 Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AcadeMedia and G5 Entertainment
The main advantage of trading using opposite AcadeMedia and G5 Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AcadeMedia position performs unexpectedly, G5 Entertainment 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 G5 Entertainment will offset losses from the drop in G5 Entertainment's long position.| AcadeMedia vs. Systemair AB | AcadeMedia vs. Air Products Chemicals | AcadeMedia vs. Ryanair Holdings plc | AcadeMedia vs. Pentair PLC |
| G5 Entertainment vs. Ashtead Technology Holdings | G5 Entertainment vs. Diversified Energy | G5 Entertainment vs. Take Two Interactive Software | G5 Entertainment vs. Chrysalis Investments |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |