Correlation Between Advantage Solutions and VS Media
Can any of the company-specific risk be diversified away by investing in both Advantage Solutions and VS 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 Advantage Solutions and VS Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advantage Solutions and VS Media Holdings, you can compare the effects of market volatilities on Advantage Solutions and VS 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 Advantage Solutions with a short position of VS Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advantage Solutions and VS Media.
Diversification Opportunities for Advantage Solutions and VS Media
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Advantage and VSME is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Advantage Solutions and VS Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VS Media Holdings and Advantage Solutions 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 Advantage Solutions are associated (or correlated) with VS Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VS Media Holdings has no effect on the direction of Advantage Solutions i.e., Advantage Solutions and VS Media go up and down completely randomly.
Pair Corralation between Advantage Solutions and VS Media
Considering the 90-day investment horizon Advantage Solutions is expected to generate 0.25 times more return on investment than VS Media. However, Advantage Solutions is 4.02 times less risky than VS Media. It trades about 0.06 of its potential returns per unit of risk. VS Media Holdings is currently generating about -0.03 per unit of risk. If you would invest 209.00 in Advantage Solutions on August 31, 2024 and sell it today you would earn a total of 147.00 from holding Advantage Solutions or generate 70.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 79.68% |
| Values | Daily Returns |
Advantage Solutions vs. VS Media Holdings
Performance |
| Timeline |
| Advantage Solutions |
| VS Media Holdings |
Advantage Solutions and VS Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advantage Solutions and VS Media
The main advantage of trading using opposite Advantage Solutions and VS Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advantage Solutions position performs unexpectedly, VS 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 VS Media will offset losses from the drop in VS Media's long position.| Advantage Solutions vs. Criteo Sa | Advantage Solutions vs. Deluxe | Advantage Solutions vs. Emerald Expositions Events | Advantage Solutions vs. Marchex |
| VS Media vs. United Parks Resorts | VS Media vs. Playtika Holding Corp | VS Media vs. BRP Inc | VS Media vs. Boyd Gaming |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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