Correlation Between International Media and Kaiser Aluminum
Can any of the company-specific risk be diversified away by investing in both International Media and Kaiser Aluminum 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 Media and Kaiser Aluminum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Media Acquisition and Kaiser Aluminum, you can compare the effects of market volatilities on International Media and Kaiser Aluminum 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 Media with a short position of Kaiser Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Media and Kaiser Aluminum.
Diversification Opportunities for International Media and Kaiser Aluminum
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and Kaiser is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding International Media Acquisitio and Kaiser Aluminum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaiser Aluminum and International Media 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 Media Acquisition are associated (or correlated) with Kaiser Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaiser Aluminum has no effect on the direction of International Media i.e., International Media and Kaiser Aluminum go up and down completely randomly.
Pair Corralation between International Media and Kaiser Aluminum
Assuming the 90 days horizon International Media Acquisition is expected to generate 26.55 times more return on investment than Kaiser Aluminum. However, International Media is 26.55 times more volatile than Kaiser Aluminum. It trades about 0.08 of its potential returns per unit of risk. Kaiser Aluminum is currently generating about 0.02 per unit of risk. If you would invest 9.20 in International Media Acquisition on September 3, 2024 and sell it today you would lose (3.20) from holding International Media Acquisition or give up 34.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 45.26% |
| Values | Daily Returns |
International Media Acquisitio vs. Kaiser Aluminum
Performance |
| Timeline |
| International Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kaiser Aluminum |
International Media and Kaiser Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Media and Kaiser Aluminum
The main advantage of trading using opposite International Media and Kaiser Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Media position performs unexpectedly, Kaiser Aluminum 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 Kaiser Aluminum will offset losses from the drop in Kaiser Aluminum's long position.| International Media vs. Saia Inc | International Media vs. Western Digital | International Media vs. Radcom | International Media vs. TFI International |
| Kaiser Aluminum vs. SPACE | Kaiser Aluminum vs. Ampleforth | Kaiser Aluminum vs. ionet | Kaiser Aluminum vs. Memecoin |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |