Correlation Between Townsquare Media and MOVIE GAMES
Can any of the company-specific risk be diversified away by investing in both Townsquare Media and MOVIE GAMES 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 Townsquare Media and MOVIE GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Townsquare Media and MOVIE GAMES SA, you can compare the effects of market volatilities on Townsquare Media and MOVIE GAMES 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 Townsquare Media with a short position of MOVIE GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Townsquare Media and MOVIE GAMES.
Diversification Opportunities for Townsquare Media and MOVIE GAMES
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Townsquare and MOVIE is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Townsquare Media and MOVIE GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOVIE GAMES SA and Townsquare 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 Townsquare Media are associated (or correlated) with MOVIE GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOVIE GAMES SA has no effect on the direction of Townsquare Media i.e., Townsquare Media and MOVIE GAMES go up and down completely randomly.
Pair Corralation between Townsquare Media and MOVIE GAMES
Assuming the 90 days horizon Townsquare Media is expected to generate 0.65 times more return on investment than MOVIE GAMES. However, Townsquare Media is 1.53 times less risky than MOVIE GAMES. It trades about 0.02 of its potential returns per unit of risk. MOVIE GAMES SA is currently generating about 0.0 per unit of risk. If you would invest 853.00 in Townsquare Media on August 31, 2024 and sell it today you would earn a total of 72.00 from holding Townsquare Media or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Townsquare Media vs. MOVIE GAMES SA
Performance |
| Timeline |
| Townsquare Media |
| MOVIE GAMES SA |
Townsquare Media and MOVIE GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Townsquare Media and MOVIE GAMES
The main advantage of trading using opposite Townsquare Media and MOVIE GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Townsquare Media position performs unexpectedly, MOVIE GAMES 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 MOVIE GAMES will offset losses from the drop in MOVIE GAMES's long position.| Townsquare Media vs. Beasley Broadcast Group | Townsquare Media vs. Xtrackers LevDAX | Townsquare Media vs. Lyxor 1 | Townsquare Media vs. Xtrackers ShortDAX |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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