Correlation Between RCS MediaGroup and MagnaChip Semiconductor
Can any of the company-specific risk be diversified away by investing in both RCS MediaGroup and MagnaChip Semiconductor 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 RCS MediaGroup and MagnaChip Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RCS MediaGroup SpA and MagnaChip Semiconductor Corp, you can compare the effects of market volatilities on RCS MediaGroup and MagnaChip Semiconductor 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 RCS MediaGroup with a short position of MagnaChip Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCS MediaGroup and MagnaChip Semiconductor.
Diversification Opportunities for RCS MediaGroup and MagnaChip Semiconductor
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between RCS and MagnaChip is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and MagnaChip Semiconductor Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MagnaChip Semiconductor and RCS MediaGroup 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 RCS MediaGroup SpA are associated (or correlated) with MagnaChip Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MagnaChip Semiconductor has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and MagnaChip Semiconductor go up and down completely randomly.
Pair Corralation between RCS MediaGroup and MagnaChip Semiconductor
Assuming the 90 days trading horizon RCS MediaGroup SpA is expected to generate 0.63 times more return on investment than MagnaChip Semiconductor. However, RCS MediaGroup SpA is 1.59 times less risky than MagnaChip Semiconductor. It trades about 0.07 of its potential returns per unit of risk. MagnaChip Semiconductor Corp is currently generating about -0.02 per unit of risk. If you would invest 76.00 in RCS MediaGroup SpA on October 26, 2024 and sell it today you would earn a total of 11.00 from holding RCS MediaGroup SpA or generate 14.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RCS MediaGroup SpA vs. MagnaChip Semiconductor Corp
Performance |
| Timeline |
| RCS MediaGroup SpA |
| MagnaChip Semiconductor |
RCS MediaGroup and MagnaChip Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCS MediaGroup and MagnaChip Semiconductor
The main advantage of trading using opposite RCS MediaGroup and MagnaChip Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCS MediaGroup position performs unexpectedly, MagnaChip Semiconductor 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 MagnaChip Semiconductor will offset losses from the drop in MagnaChip Semiconductor's long position.| RCS MediaGroup vs. RELX PLC | RCS MediaGroup vs. Relx PLC ADR | RCS MediaGroup vs. Wolters Kluwer NV | RCS MediaGroup vs. WOLTERS KLUWER ADR |
| MagnaChip Semiconductor vs. ZINC MEDIA GR | MagnaChip Semiconductor vs. ANTA SPORTS PRODUCT | MagnaChip Semiconductor vs. Harmony Gold Mining | MagnaChip Semiconductor vs. RCS MediaGroup SpA |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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