Correlation Between Media 6 and Lacroix Group
Can any of the company-specific risk be diversified away by investing in both Media 6 and Lacroix Group 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 Media 6 and Lacroix Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media 6 SA and Lacroix Group SA, you can compare the effects of market volatilities on Media 6 and Lacroix Group 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 Media 6 with a short position of Lacroix Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media 6 and Lacroix Group.
Diversification Opportunities for Media 6 and Lacroix Group
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Media and Lacroix is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Media 6 SA and Lacroix Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lacroix Group SA and Media 6 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 Media 6 SA are associated (or correlated) with Lacroix Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lacroix Group SA has no effect on the direction of Media 6 i.e., Media 6 and Lacroix Group go up and down completely randomly.
Pair Corralation between Media 6 and Lacroix Group
Assuming the 90 days trading horizon Media 6 SA is expected to generate 1.72 times more return on investment than Lacroix Group. However, Media 6 is 1.72 times more volatile than Lacroix Group SA. It trades about 0.06 of its potential returns per unit of risk. Lacroix Group SA is currently generating about -0.15 per unit of risk. If you would invest 820.00 in Media 6 SA on August 27, 2024 and sell it today you would earn a total of 370.00 from holding Media 6 SA or generate 45.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media 6 SA vs. Lacroix Group SA
Performance |
| Timeline |
| Media 6 SA |
| Lacroix Group SA |
Media 6 and Lacroix Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media 6 and Lacroix Group
The main advantage of trading using opposite Media 6 and Lacroix Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media 6 position performs unexpectedly, Lacroix Group 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 Lacroix Group will offset losses from the drop in Lacroix Group's long position.| Media 6 vs. Lacroix Group SA | Media 6 vs. Fiducial Office Solutions | Media 6 vs. ACTEOS SA | Media 6 vs. Passat Socit Anonyme |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |