Correlation Between Imax Corp and Tegna
Can any of the company-specific risk be diversified away by investing in both Imax Corp and Tegna 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 Imax Corp and Tegna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imax Corp and Tegna Inc, you can compare the effects of market volatilities on Imax Corp and Tegna 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 Imax Corp with a short position of Tegna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imax Corp and Tegna.
Diversification Opportunities for Imax Corp and Tegna
Poor diversification
The 3 months correlation between Imax and Tegna is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Imax Corp and Tegna Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tegna Inc and Imax Corp 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 Imax Corp are associated (or correlated) with Tegna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tegna Inc has no effect on the direction of Imax Corp i.e., Imax Corp and Tegna go up and down completely randomly.
Pair Corralation between Imax Corp and Tegna
Given the investment horizon of 90 days Imax Corp is expected to generate 0.85 times more return on investment than Tegna. However, Imax Corp is 1.18 times less risky than Tegna. It trades about 0.35 of its potential returns per unit of risk. Tegna Inc is currently generating about 0.19 per unit of risk. If you would invest 2,055 in Imax Corp on August 27, 2024 and sell it today you would earn a total of 464.00 from holding Imax Corp or generate 22.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imax Corp vs. Tegna Inc
Performance |
| Timeline |
| Imax Corp |
| Tegna Inc |
Imax Corp and Tegna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imax Corp and Tegna
The main advantage of trading using opposite Imax Corp and Tegna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imax Corp position performs unexpectedly, Tegna 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 Tegna will offset losses from the drop in Tegna's long position.| Imax Corp vs. ADTRAN Inc | Imax Corp vs. Belden Inc | Imax Corp vs. ADC Therapeutics SA | Imax Corp vs. Comtech Telecommunications Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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