Correlation Between Interpublic Group and Media Nusantara
Can any of the company-specific risk be diversified away by investing in both Interpublic Group and Media Nusantara 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 Interpublic Group and Media Nusantara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interpublic Group of and Media Nusantara Citra, you can compare the effects of market volatilities on Interpublic Group and Media Nusantara 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 Interpublic Group with a short position of Media Nusantara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interpublic Group and Media Nusantara.
Diversification Opportunities for Interpublic Group and Media Nusantara
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Interpublic and Media is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Interpublic Group of and Media Nusantara Citra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media Nusantara Citra and Interpublic Group 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 Interpublic Group of are associated (or correlated) with Media Nusantara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media Nusantara Citra has no effect on the direction of Interpublic Group i.e., Interpublic Group and Media Nusantara go up and down completely randomly.
Pair Corralation between Interpublic Group and Media Nusantara
Considering the 90-day investment horizon Interpublic Group of is expected to generate 0.51 times more return on investment than Media Nusantara. However, Interpublic Group of is 1.97 times less risky than Media Nusantara. It trades about 0.01 of its potential returns per unit of risk. Media Nusantara Citra is currently generating about -0.06 per unit of risk. If you would invest 2,997 in Interpublic Group of on August 30, 2024 and sell it today you would earn a total of 51.00 from holding Interpublic Group of or generate 1.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Interpublic Group of vs. Media Nusantara Citra
Performance |
| Timeline |
| Interpublic Group |
| Media Nusantara Citra |
Interpublic Group and Media Nusantara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interpublic Group and Media Nusantara
The main advantage of trading using opposite Interpublic Group and Media Nusantara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interpublic Group position performs unexpectedly, Media Nusantara 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 Nusantara will offset losses from the drop in Media Nusantara's long position.| Interpublic Group vs. Mirriad Advertising plc | Interpublic Group vs. INEO Tech Corp | Interpublic Group vs. Kidoz Inc | Interpublic Group vs. Marchex |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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