Correlation Between Centaur Media and AcadeMedia
Can any of the company-specific risk be diversified away by investing in both Centaur Media and AcadeMedia 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 AcadeMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centaur Media and AcadeMedia AB, you can compare the effects of market volatilities on Centaur Media and AcadeMedia 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 AcadeMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centaur Media and AcadeMedia.
Diversification Opportunities for Centaur Media and AcadeMedia
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Centaur and AcadeMedia is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Centaur Media and AcadeMedia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AcadeMedia AB 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 AcadeMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AcadeMedia AB has no effect on the direction of Centaur Media i.e., Centaur Media and AcadeMedia go up and down completely randomly.
Pair Corralation between Centaur Media and AcadeMedia
Assuming the 90 days trading horizon Centaur Media is expected to generate 2.17 times more return on investment than AcadeMedia. However, Centaur Media is 2.17 times more volatile than AcadeMedia AB. It trades about 0.16 of its potential returns per unit of risk. AcadeMedia AB is currently generating about 0.1 per unit of risk. If you would invest 2,300 in Centaur Media on October 26, 2024 and sell it today you would earn a total of 650.00 from holding Centaur Media or generate 28.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centaur Media vs. AcadeMedia AB
Performance |
| Timeline |
| Centaur Media |
| AcadeMedia AB |
Centaur Media and AcadeMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centaur Media and AcadeMedia
The main advantage of trading using opposite Centaur Media and AcadeMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centaur Media position performs unexpectedly, AcadeMedia 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 AcadeMedia will offset losses from the drop in AcadeMedia's long position.| Centaur Media vs. Atresmedia | Centaur Media vs. Impax Asset Management | Centaur Media vs. JD Sports Fashion | Centaur Media vs. Catalyst Media Group |
| AcadeMedia vs. DXC Technology Co | AcadeMedia vs. Canadian General Investments | AcadeMedia vs. Schroders Investment Trusts | AcadeMedia vs. JPMorgan Japanese 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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