Correlation Between HHG Capital and International Media
Can any of the company-specific risk be diversified away by investing in both HHG Capital and International 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 HHG Capital and International Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HHG Capital Corp and International Media Acquisition, you can compare the effects of market volatilities on HHG Capital and International 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 HHG Capital with a short position of International Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of HHG Capital and International Media.
Diversification Opportunities for HHG Capital and International Media
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HHG and International is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding HHG Capital Corp and International Media Acquisitio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Media and HHG Capital 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 HHG Capital Corp are associated (or correlated) with International Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Media has no effect on the direction of HHG Capital i.e., HHG Capital and International Media go up and down completely randomly.
Pair Corralation between HHG Capital and International Media
Assuming the 90 days horizon HHG Capital Corp is expected to generate 0.78 times more return on investment than International Media. However, HHG Capital Corp is 1.28 times less risky than International Media. It trades about 0.02 of its potential returns per unit of risk. International Media Acquisition is currently generating about 0.01 per unit of risk. If you would invest 1,135 in HHG Capital Corp on August 28, 2024 and sell it today you would earn a total of 15.00 from holding HHG Capital Corp or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 57.14% |
| Values | Daily Returns |
HHG Capital Corp vs. International Media Acquisitio
Performance |
| Timeline |
| HHG Capital Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| International Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
HHG Capital and International Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HHG Capital and International Media
The main advantage of trading using opposite HHG Capital and International Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HHG Capital position performs unexpectedly, International 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 International Media will offset losses from the drop in International Media's long position.The idea behind HHG Capital Corp and International Media Acquisition 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.| International Media vs. Grupo Aeroportuario del | International Media vs. Luxfer Holdings PLC | International Media vs. Axalta Coating Systems | International Media vs. Balchem |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |