Correlation Between Afine Investments and EMedia Holdings
Can any of the company-specific risk be diversified away by investing in both Afine Investments and EMedia Holdings 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 Afine Investments and EMedia Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afine Investments and eMedia Holdings Limited, you can compare the effects of market volatilities on Afine Investments and EMedia Holdings 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 Afine Investments with a short position of EMedia Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afine Investments and EMedia Holdings.
Diversification Opportunities for Afine Investments and EMedia Holdings
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Afine and EMedia is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Afine Investments and eMedia Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eMedia Holdings and Afine Investments 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 Afine Investments are associated (or correlated) with EMedia Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eMedia Holdings has no effect on the direction of Afine Investments i.e., Afine Investments and EMedia Holdings go up and down completely randomly.
Pair Corralation between Afine Investments and EMedia Holdings
Assuming the 90 days trading horizon Afine Investments is expected to generate 1.4 times more return on investment than EMedia Holdings. However, Afine Investments is 1.4 times more volatile than eMedia Holdings Limited. It trades about 0.22 of its potential returns per unit of risk. eMedia Holdings Limited is currently generating about -0.04 per unit of risk. If you would invest 40,000 in Afine Investments on September 1, 2024 and sell it today you would earn a total of 5,000 from holding Afine Investments or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afine Investments vs. eMedia Holdings Limited
Performance |
| Timeline |
| Afine Investments |
| eMedia Holdings |
Afine Investments and EMedia Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afine Investments and EMedia Holdings
The main advantage of trading using opposite Afine Investments and EMedia Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afine Investments position performs unexpectedly, EMedia Holdings 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 EMedia Holdings will offset losses from the drop in EMedia Holdings' long position.| Afine Investments vs. Deneb Investments | Afine Investments vs. Astoria Investments | Afine Investments vs. Trematon Capital Investments | Afine Investments vs. Zeder Investments |
| EMedia Holdings vs. MultiChoice Group | EMedia Holdings vs. Sasol Ltd Bee | EMedia Holdings vs. Growthpoint Properties | EMedia Holdings vs. AfricaRhodium ETF |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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