Correlation Between A10 Network and NATION MEDIA
Can any of the company-specific risk be diversified away by investing in both A10 Network and NATION 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 A10 Network and NATION MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between A10 Network and NATION MEDIA GROUP, you can compare the effects of market volatilities on A10 Network and NATION 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 A10 Network with a short position of NATION MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of A10 Network and NATION MEDIA.
Diversification Opportunities for A10 Network and NATION MEDIA
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between A10 and NATION is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding A10 Network and NATION MEDIA GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATION MEDIA GROUP and A10 Network 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 A10 Network are associated (or correlated) with NATION MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATION MEDIA GROUP has no effect on the direction of A10 Network i.e., A10 Network and NATION MEDIA go up and down completely randomly.
Pair Corralation between A10 Network and NATION MEDIA
Given the investment horizon of 90 days A10 Network is expected to generate 0.8 times more return on investment than NATION MEDIA. However, A10 Network is 1.24 times less risky than NATION MEDIA. It trades about 0.04 of its potential returns per unit of risk. NATION MEDIA GROUP is currently generating about 0.02 per unit of risk. If you would invest 1,414 in A10 Network on December 11, 2024 and sell it today you would earn a total of 524.00 from holding A10 Network or generate 37.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.58% |
| Values | Daily Returns |
A10 Network vs. NATION MEDIA GROUP
Performance |
| Timeline |
| A10 Network |
| NATION MEDIA GROUP |
A10 Network and NATION MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with A10 Network and NATION MEDIA
The main advantage of trading using opposite A10 Network and NATION MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A10 Network position performs unexpectedly, NATION 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 NATION MEDIA will offset losses from the drop in NATION MEDIA's long position.| A10 Network vs. Evertec | ||
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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