Correlation Between Creative Media and Glassbox
Can any of the company-specific risk be diversified away by investing in both Creative Media and Glassbox 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 Creative Media and Glassbox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Creative Media Community and Glassbox, you can compare the effects of market volatilities on Creative Media and Glassbox 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 Creative Media with a short position of Glassbox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creative Media and Glassbox.
Diversification Opportunities for Creative Media and Glassbox
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Creative and Glassbox is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Creative Media Community and Glassbox in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glassbox and Creative 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 Creative Media Community are associated (or correlated) with Glassbox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glassbox has no effect on the direction of Creative Media i.e., Creative Media and Glassbox go up and down completely randomly.
Pair Corralation between Creative Media and Glassbox
Assuming the 90 days trading horizon Creative Media Community is expected to under-perform the Glassbox. In addition to that, Creative Media is 2.2 times more volatile than Glassbox. It trades about -0.34 of its total potential returns per unit of risk. Glassbox is currently generating about 0.07 per unit of volatility. If you would invest 377,400 in Glassbox on August 29, 2024 and sell it today you would earn a total of 28,500 from holding Glassbox or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 71.74% |
| Values | Daily Returns |
Creative Media Community vs. Glassbox
Performance |
| Timeline |
| Creative Media Community |
| Glassbox |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Creative Media and Glassbox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creative Media and Glassbox
The main advantage of trading using opposite Creative Media and Glassbox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creative Media position performs unexpectedly, Glassbox 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 Glassbox will offset losses from the drop in Glassbox's long position.| Creative Media vs. Nice | Creative Media vs. The Gold Bond | Creative Media vs. Bank Leumi Le Israel | Creative Media vs. ICL Israel Chemicals |
| Glassbox vs. MediPress Health Limited Partnership | Glassbox vs. Hiron Trade Investments Industrial | Glassbox vs. Clal Insurance Enterprises | Glassbox vs. Veridis Environment |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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