Correlation Between Iron Mountain and Comcast

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Iron Mountain and Comcast 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 Iron Mountain and Comcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iron Mountain Incorporated and Comcast, you can compare the effects of market volatilities on Iron Mountain and Comcast 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 Iron Mountain with a short position of Comcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iron Mountain and Comcast.

Diversification Opportunities for Iron Mountain and Comcast

0.72
  Correlation Coefficient

Poor diversification

The 3 months correlation between Iron and Comcast is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Iron Mountain Incorporated and Comcast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comcast and Iron Mountain 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 Iron Mountain Incorporated are associated (or correlated) with Comcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comcast has no effect on the direction of Iron Mountain i.e., Iron Mountain and Comcast go up and down completely randomly.

Pair Corralation between Iron Mountain and Comcast

Assuming the 90 days trading horizon Iron Mountain Incorporated is expected to generate 1.31 times more return on investment than Comcast. However, Iron Mountain is 1.31 times more volatile than Comcast. It trades about 0.28 of its potential returns per unit of risk. Comcast is currently generating about 0.07 per unit of risk. If you would invest  30,816  in Iron Mountain Incorporated on September 3, 2024 and sell it today you would earn a total of  43,659  from holding Iron Mountain Incorporated or generate 141.68% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy59.84%
ValuesDaily Returns

Iron Mountain Incorporated  vs.  Comcast

 Performance 
       Timeline  
Iron Mountain 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Iron Mountain Incorporated are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Iron Mountain sustained solid returns over the last few months and may actually be approaching a breakup point.
Comcast 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Comcast are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental indicators, Comcast sustained solid returns over the last few months and may actually be approaching a breakup point.

Iron Mountain and Comcast Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Iron Mountain and Comcast

The main advantage of trading using opposite Iron Mountain and Comcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iron Mountain position performs unexpectedly, Comcast 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 Comcast will offset losses from the drop in Comcast's long position.
The idea behind Iron Mountain Incorporated and Comcast 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.
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

Other Complementary Tools

Sign In To Macroaxis
Sign in to explore Macroaxis' wealth optimization platform and fintech modules
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes