Correlation Between EMedia Holdings and Hosken Consolidated
Can any of the company-specific risk be diversified away by investing in both EMedia Holdings and Hosken Consolidated 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 EMedia Holdings and Hosken Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eMedia Holdings Limited and Hosken Consolidated Investments, you can compare the effects of market volatilities on EMedia Holdings and Hosken Consolidated 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 EMedia Holdings with a short position of Hosken Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMedia Holdings and Hosken Consolidated.
Diversification Opportunities for EMedia Holdings and Hosken Consolidated
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EMedia and Hosken is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding eMedia Holdings Limited and Hosken Consolidated Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hosken Consolidated and EMedia Holdings 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 eMedia Holdings Limited are associated (or correlated) with Hosken Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hosken Consolidated has no effect on the direction of EMedia Holdings i.e., EMedia Holdings and Hosken Consolidated go up and down completely randomly.
Pair Corralation between EMedia Holdings and Hosken Consolidated
Assuming the 90 days trading horizon eMedia Holdings Limited is expected to under-perform the Hosken Consolidated. In addition to that, EMedia Holdings is 3.24 times more volatile than Hosken Consolidated Investments. It trades about -0.24 of its total potential returns per unit of risk. Hosken Consolidated Investments is currently generating about -0.12 per unit of volatility. If you would invest 1,648,400 in Hosken Consolidated Investments on October 22, 2024 and sell it today you would lose (37,200) from holding Hosken Consolidated Investments or give up 2.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
eMedia Holdings Limited vs. Hosken Consolidated Investment
Performance |
| Timeline |
| eMedia Holdings |
| Hosken Consolidated |
EMedia Holdings and Hosken Consolidated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMedia Holdings and Hosken Consolidated
The main advantage of trading using opposite EMedia Holdings and Hosken Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMedia Holdings position performs unexpectedly, Hosken Consolidated 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 Hosken Consolidated will offset losses from the drop in Hosken Consolidated's long position.| EMedia Holdings vs. Hosken Consolidated Investments | EMedia Holdings vs. Copper 360 | EMedia Holdings vs. Bytes Technology | EMedia Holdings vs. Zeder Investments |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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