Correlation Between Fox Corp and E W
Can any of the company-specific risk be diversified away by investing in both Fox Corp and E W 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 Fox Corp and E W into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fox Corp Class and E W Scripps, you can compare the effects of market volatilities on Fox Corp and E W 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 Fox Corp with a short position of E W. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fox Corp and E W.
Diversification Opportunities for Fox Corp and E W
Good diversification
The 3 months correlation between Fox and SSP is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Fox Corp Class and E W Scripps in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on E W Scripps and Fox Corp 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 Fox Corp Class are associated (or correlated) with E W. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of E W Scripps has no effect on the direction of Fox Corp i.e., Fox Corp and E W go up and down completely randomly.
Pair Corralation between Fox Corp and E W
Given the investment horizon of 90 days Fox Corp Class is expected to generate 0.19 times more return on investment than E W. However, Fox Corp Class is 5.31 times less risky than E W. It trades about 0.21 of its potential returns per unit of risk. E W Scripps is currently generating about 0.0 per unit of risk. If you would invest 3,429 in Fox Corp Class on September 2, 2024 and sell it today you would earn a total of 1,283 from holding Fox Corp Class or generate 37.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fox Corp Class vs. E W Scripps
Performance |
| Timeline |
| Fox Corp Class |
| E W Scripps |
Fox Corp and E W Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fox Corp and E W
The main advantage of trading using opposite Fox Corp and E W positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fox Corp position performs unexpectedly, E W 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 E W will offset losses from the drop in E W's long position.| Fox Corp vs. News Corp B | Fox Corp vs. News Corp A | Fox Corp vs. Live Nation Entertainment | Fox Corp vs. Paramount Global Class |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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