Correlation Between Centaur Media and Prudential Financial
Can any of the company-specific risk be diversified away by investing in both Centaur Media and Prudential Financial 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 Centaur Media and Prudential Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centaur Media and Prudential Financial, you can compare the effects of market volatilities on Centaur Media and Prudential Financial 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 Centaur Media with a short position of Prudential Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaur Media and Prudential Financial.
Diversification Opportunities for Centaur Media and Prudential Financial
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Centaur and Prudential is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Centaur Media and Prudential Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Financial and Centaur 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 Centaur Media are associated (or correlated) with Prudential Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Financial has no effect on the direction of Centaur Media i.e., Centaur Media and Prudential Financial go up and down completely randomly.
Pair Corralation between Centaur Media and Prudential Financial
Assuming the 90 days trading horizon Centaur Media is expected to under-perform the Prudential Financial. In addition to that, Centaur Media is 1.7 times more volatile than Prudential Financial. It trades about -0.13 of its total potential returns per unit of risk. Prudential Financial is currently generating about 0.1 per unit of volatility. If you would invest 11,695 in Prudential Financial on August 28, 2024 and sell it today you would earn a total of 1,215 from holding Prudential Financial or generate 10.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centaur Media vs. Prudential Financial
Performance |
| Timeline |
| Centaur Media |
| Prudential Financial |
Centaur Media and Prudential Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centaur Media and Prudential Financial
The main advantage of trading using opposite Centaur Media and Prudential Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centaur Media position performs unexpectedly, Prudential Financial 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 Prudential Financial will offset losses from the drop in Prudential Financial's long position.| Centaur Media vs. SupplyMe Capital PLC | Centaur Media vs. SM Energy Co | Centaur Media vs. FuelCell Energy | Centaur Media vs. Grand Vision Media |
| Prudential Financial vs. FC Investment Trust | Prudential Financial vs. Tatton Asset Management | Prudential Financial vs. Lowland Investment Co | Prudential Financial vs. Federal Realty Investment |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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