Correlation Between RCS MediaGroup and WILLIS LEASE
Can any of the company-specific risk be diversified away by investing in both RCS MediaGroup and WILLIS LEASE 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 WILLIS LEASE 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 WILLIS LEASE FIN, you can compare the effects of market volatilities on RCS MediaGroup and WILLIS LEASE 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 WILLIS LEASE. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCS MediaGroup and WILLIS LEASE.
Diversification Opportunities for RCS MediaGroup and WILLIS LEASE
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between RCS and WILLIS is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and WILLIS LEASE FIN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WILLIS LEASE FIN 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 WILLIS LEASE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WILLIS LEASE FIN has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and WILLIS LEASE go up and down completely randomly.
Pair Corralation between RCS MediaGroup and WILLIS LEASE
Assuming the 90 days trading horizon RCS MediaGroup SpA is expected to generate 1.0 times more return on investment than WILLIS LEASE. However, RCS MediaGroup SpA is 1.0 times less risky than WILLIS LEASE. It trades about 0.11 of its potential returns per unit of risk. WILLIS LEASE FIN is currently generating about -0.21 per unit of risk. If you would invest 86.00 in RCS MediaGroup SpA on November 8, 2024 and sell it today you would earn a total of 4.00 from holding RCS MediaGroup SpA or generate 4.65% 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. WILLIS LEASE FIN
Performance |
| Timeline |
| RCS MediaGroup SpA |
| WILLIS LEASE FIN |
RCS MediaGroup and WILLIS LEASE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCS MediaGroup and WILLIS LEASE
The main advantage of trading using opposite RCS MediaGroup and WILLIS LEASE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCS MediaGroup position performs unexpectedly, WILLIS LEASE 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 WILLIS LEASE will offset losses from the drop in WILLIS LEASE's long position.| RCS MediaGroup vs. COVIVIO HOTELS INH | RCS MediaGroup vs. VELA TECHNOLPLC LS 0001 | RCS MediaGroup vs. THORNEY TECHS LTD | RCS MediaGroup vs. PPHE HOTEL GROUP |
| WILLIS LEASE vs. CompuGroup Medical SE | WILLIS LEASE vs. The Japan Steel | WILLIS LEASE vs. Japan Medical Dynamic | WILLIS LEASE vs. Peijia Medical Limited |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |