Correlation Between Cablevision Holding and Ferrum SA

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Can any of the company-specific risk be diversified away by investing in both Cablevision Holding and Ferrum SA 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 Cablevision Holding and Ferrum SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cablevision Holding SA and Ferrum SA, you can compare the effects of market volatilities on Cablevision Holding and Ferrum SA 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 Cablevision Holding with a short position of Ferrum SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cablevision Holding and Ferrum SA.

Diversification Opportunities for Cablevision Holding and Ferrum SA

-0.84
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Cablevision and Ferrum is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Cablevision Holding SA and Ferrum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ferrum SA and Cablevision Holding 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 Cablevision Holding SA are associated (or correlated) with Ferrum SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ferrum SA has no effect on the direction of Cablevision Holding i.e., Cablevision Holding and Ferrum SA go up and down completely randomly.

Pair Corralation between Cablevision Holding and Ferrum SA

Assuming the 90 days trading horizon Cablevision Holding SA is expected to generate 1.05 times more return on investment than Ferrum SA. However, Cablevision Holding is 1.05 times more volatile than Ferrum SA. It trades about 0.13 of its potential returns per unit of risk. Ferrum SA is currently generating about 0.09 per unit of risk. If you would invest  711,000  in Cablevision Holding SA on October 24, 2024 and sell it today you would earn a total of  44,000  from holding Cablevision Holding SA or generate 6.19% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Cablevision Holding SA  vs.  Ferrum SA

 Performance 
       Timeline  
Cablevision Holding 

Risk-Adjusted Performance

24 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Cablevision Holding SA are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical indicators, Cablevision Holding sustained solid returns over the last few months and may actually be approaching a breakup point.
Ferrum SA 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Ferrum SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Cablevision Holding and Ferrum SA Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cablevision Holding and Ferrum SA

The main advantage of trading using opposite Cablevision Holding and Ferrum SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cablevision Holding position performs unexpectedly, Ferrum SA 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 Ferrum SA will offset losses from the drop in Ferrum SA's long position.
The idea behind Cablevision Holding SA and Ferrum SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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