Correlation Between Netmedia Group and Hitechpros
Can any of the company-specific risk be diversified away by investing in both Netmedia Group and Hitechpros 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 Netmedia Group and Hitechpros into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netmedia Group SA and Hitechpros, you can compare the effects of market volatilities on Netmedia Group and Hitechpros 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 Netmedia Group with a short position of Hitechpros. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netmedia Group and Hitechpros.
Diversification Opportunities for Netmedia Group and Hitechpros
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Netmedia and Hitechpros is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Netmedia Group SA and Hitechpros in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hitechpros and Netmedia Group 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 Netmedia Group SA are associated (or correlated) with Hitechpros. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hitechpros has no effect on the direction of Netmedia Group i.e., Netmedia Group and Hitechpros go up and down completely randomly.
Pair Corralation between Netmedia Group and Hitechpros
Assuming the 90 days trading horizon Netmedia Group SA is expected to under-perform the Hitechpros. But the stock apears to be less risky and, when comparing its historical volatility, Netmedia Group SA is 1.08 times less risky than Hitechpros. The stock trades about -0.04 of its potential returns per unit of risk. The Hitechpros is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,530 in Hitechpros on August 30, 2024 and sell it today you would earn a total of 30.00 from holding Hitechpros or generate 1.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.43% |
| Values | Daily Returns |
Netmedia Group SA vs. Hitechpros
Performance |
| Timeline |
| Netmedia Group SA |
| Hitechpros |
Netmedia Group and Hitechpros Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netmedia Group and Hitechpros
The main advantage of trading using opposite Netmedia Group and Hitechpros positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netmedia Group position performs unexpectedly, Hitechpros 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 Hitechpros will offset losses from the drop in Hitechpros' long position.| Netmedia Group vs. LVMH Mot Hennessy | Netmedia Group vs. LOreal SA | Netmedia Group vs. Hermes International SCA | Netmedia Group vs. Manitou BF SA |
| Hitechpros vs. Aubay Socit Anonyme | Hitechpros vs. Infotel SA | Hitechpros vs. IT Link | Hitechpros vs. Manitou BF SA |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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