Correlation Between International Consolidated and Media Investment
Can any of the company-specific risk be diversified away by investing in both International Consolidated and Media Investment 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 International Consolidated and Media Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Consolidated Airlines and Media Investment Optimization, you can compare the effects of market volatilities on International Consolidated and Media Investment 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 International Consolidated with a short position of Media Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Consolidated and Media Investment.
Diversification Opportunities for International Consolidated and Media Investment
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and Media is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and Media Investment Optimization in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media Investment Opt and International Consolidated 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 International Consolidated Airlines are associated (or correlated) with Media Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media Investment Opt has no effect on the direction of International Consolidated i.e., International Consolidated and Media Investment go up and down completely randomly.
Pair Corralation between International Consolidated and Media Investment
Assuming the 90 days trading horizon International Consolidated Airlines is expected to generate 0.93 times more return on investment than Media Investment. However, International Consolidated Airlines is 1.07 times less risky than Media Investment. It trades about 0.24 of its potential returns per unit of risk. Media Investment Optimization is currently generating about -0.41 per unit of risk. If you would invest 364.00 in International Consolidated Airlines on October 25, 2024 and sell it today you would earn a total of 25.00 from holding International Consolidated Airlines or generate 6.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Consolidated Air vs. Media Investment Optimization
Performance |
| Timeline |
| International Consolidated |
| Media Investment Opt |
International Consolidated and Media Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Consolidated and Media Investment
The main advantage of trading using opposite International Consolidated and Media Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, Media Investment 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 Media Investment will offset losses from the drop in Media Investment's long position.| International Consolidated vs. Atrys Health SL | International Consolidated vs. Ebro Foods | International Consolidated vs. Millenium Hotels Real | International Consolidated vs. Parlem Telecom Companyia |
| Media Investment vs. Ebro Foods | Media Investment vs. Home Capital Rentals | Media Investment vs. International Consolidated Airlines |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Correlations Find global opportunities by holding instruments from different markets |