Correlation Between Clear Channel and Mirriad Advertising
Can any of the company-specific risk be diversified away by investing in both Clear Channel and Mirriad Advertising 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 Clear Channel and Mirriad Advertising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clear Channel Outdoor and Mirriad Advertising plc, you can compare the effects of market volatilities on Clear Channel and Mirriad Advertising 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 Clear Channel with a short position of Mirriad Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clear Channel and Mirriad Advertising.
Diversification Opportunities for Clear Channel and Mirriad Advertising
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clear and Mirriad is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Clear Channel Outdoor and Mirriad Advertising plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirriad Advertising plc and Clear Channel 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 Clear Channel Outdoor are associated (or correlated) with Mirriad Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirriad Advertising plc has no effect on the direction of Clear Channel i.e., Clear Channel and Mirriad Advertising go up and down completely randomly.
Pair Corralation between Clear Channel and Mirriad Advertising
Considering the 90-day investment horizon Clear Channel Outdoor is expected to generate 0.3 times more return on investment than Mirriad Advertising. However, Clear Channel Outdoor is 3.3 times less risky than Mirriad Advertising. It trades about 0.03 of its potential returns per unit of risk. Mirriad Advertising plc is currently generating about -0.22 per unit of risk. If you would invest 157.00 in Clear Channel Outdoor on August 28, 2024 and sell it today you would earn a total of 2.00 from holding Clear Channel Outdoor or generate 1.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clear Channel Outdoor vs. Mirriad Advertising plc
Performance |
| Timeline |
| Clear Channel Outdoor |
| Mirriad Advertising plc |
Clear Channel and Mirriad Advertising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clear Channel and Mirriad Advertising
The main advantage of trading using opposite Clear Channel and Mirriad Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clear Channel position performs unexpectedly, Mirriad Advertising 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 Mirriad Advertising will offset losses from the drop in Mirriad Advertising's long position.| Clear Channel vs. Mirriad Advertising plc | Clear Channel vs. INEO Tech Corp | Clear Channel vs. Innovid Corp | Clear Channel vs. Townsquare Media |
| Mirriad Advertising vs. INEO Tech Corp | Mirriad Advertising vs. Kidoz Inc | Mirriad Advertising vs. Marchex | Mirriad Advertising vs. Snipp Interactive |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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