Correlation Between Energy Transfer and ProSiebenSat1 Media
Can any of the company-specific risk be diversified away by investing in both Energy Transfer and ProSiebenSat1 Media 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 Energy Transfer and ProSiebenSat1 Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Transfer LP and ProSiebenSat1 Media AG, you can compare the effects of market volatilities on Energy Transfer and ProSiebenSat1 Media 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 Energy Transfer with a short position of ProSiebenSat1 Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Transfer and ProSiebenSat1 Media.
Diversification Opportunities for Energy Transfer and ProSiebenSat1 Media
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Energy and ProSiebenSat1 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Energy Transfer LP and ProSiebenSat1 Media AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProSiebenSat1 Media and Energy Transfer 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 Energy Transfer LP are associated (or correlated) with ProSiebenSat1 Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProSiebenSat1 Media has no effect on the direction of Energy Transfer i.e., Energy Transfer and ProSiebenSat1 Media go up and down completely randomly.
Pair Corralation between Energy Transfer and ProSiebenSat1 Media
Allowing for the 90-day total investment horizon Energy Transfer is expected to generate 33.61 times less return on investment than ProSiebenSat1 Media. But when comparing it to its historical volatility, Energy Transfer LP is 1.33 times less risky than ProSiebenSat1 Media. It trades about 0.01 of its potential returns per unit of risk. ProSiebenSat1 Media AG is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 120.00 in ProSiebenSat1 Media AG on November 18, 2024 and sell it today you would earn a total of 21.00 from holding ProSiebenSat1 Media AG or generate 17.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Transfer LP vs. ProSiebenSat1 Media AG
Performance |
| Timeline |
| Energy Transfer LP |
| ProSiebenSat1 Media |
Energy Transfer and ProSiebenSat1 Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Transfer and ProSiebenSat1 Media
The main advantage of trading using opposite Energy Transfer and ProSiebenSat1 Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Transfer position performs unexpectedly, ProSiebenSat1 Media 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 ProSiebenSat1 Media will offset losses from the drop in ProSiebenSat1 Media's long position.| Energy Transfer vs. Kinder Morgan | Energy Transfer vs. MPLX LP | Energy Transfer vs. Enbridge | Energy Transfer vs. Enterprise Products Partners |
| ProSiebenSat1 Media vs. RTL Group SA | ProSiebenSat1 Media vs. iHeartMedia | ProSiebenSat1 Media vs. ITV PLC ADR | ProSiebenSat1 Media vs. RTL Group SA |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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