Correlation Between Ihuman and Nexstar Broadcasting
Can any of the company-specific risk be diversified away by investing in both Ihuman and Nexstar Broadcasting 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 Ihuman and Nexstar Broadcasting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and Nexstar Broadcasting Group, you can compare the effects of market volatilities on Ihuman and Nexstar Broadcasting 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 Ihuman with a short position of Nexstar Broadcasting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and Nexstar Broadcasting.
Diversification Opportunities for Ihuman and Nexstar Broadcasting
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ihuman and Nexstar is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and Nexstar Broadcasting Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexstar Broadcasting and Ihuman 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 Ihuman Inc are associated (or correlated) with Nexstar Broadcasting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexstar Broadcasting has no effect on the direction of Ihuman i.e., Ihuman and Nexstar Broadcasting go up and down completely randomly.
Pair Corralation between Ihuman and Nexstar Broadcasting
Allowing for the 90-day total investment horizon Ihuman Inc is expected to under-perform the Nexstar Broadcasting. But the stock apears to be less risky and, when comparing its historical volatility, Ihuman Inc is 1.66 times less risky than Nexstar Broadcasting. The stock trades about -0.39 of its potential returns per unit of risk. The Nexstar Broadcasting Group is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 17,204 in Nexstar Broadcasting Group on August 28, 2024 and sell it today you would lose (143.00) from holding Nexstar Broadcasting Group or give up 0.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ihuman Inc vs. Nexstar Broadcasting Group
Performance |
| Timeline |
| Ihuman Inc |
| Nexstar Broadcasting |
Ihuman and Nexstar Broadcasting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and Nexstar Broadcasting
The main advantage of trading using opposite Ihuman and Nexstar Broadcasting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman position performs unexpectedly, Nexstar Broadcasting 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 Nexstar Broadcasting will offset losses from the drop in Nexstar Broadcasting's long position.| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
| Nexstar Broadcasting vs. News Corp B | Nexstar Broadcasting vs. Fox Corp Class | Nexstar Broadcasting vs. Liberty Media | Nexstar Broadcasting vs. AMC Networks |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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