Correlation Between Liberty Media and ITV PLC
Can any of the company-specific risk be diversified away by investing in both Liberty Media and ITV PLC 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 Liberty Media and ITV PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Media and ITV PLC ADR, you can compare the effects of market volatilities on Liberty Media and ITV PLC 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 Liberty Media with a short position of ITV PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Media and ITV PLC.
Diversification Opportunities for Liberty Media and ITV PLC
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Liberty and ITV is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Media and ITV PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITV PLC ADR and Liberty 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 Liberty Media are associated (or correlated) with ITV PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITV PLC ADR has no effect on the direction of Liberty Media i.e., Liberty Media and ITV PLC go up and down completely randomly.
Pair Corralation between Liberty Media and ITV PLC
If you would invest 2,229 in Liberty Media on October 21, 2024 and sell it today you would earn a total of 0.00 from holding Liberty Media or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Liberty Media vs. ITV PLC ADR
Performance |
| Timeline |
| Liberty Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ITV PLC ADR |
Liberty Media and ITV PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Media and ITV PLC
The main advantage of trading using opposite Liberty Media and ITV PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Media position performs unexpectedly, ITV PLC 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 ITV PLC will offset losses from the drop in ITV PLC's long position.| Liberty Media vs. Saga Communications | Liberty Media vs. Cumulus Media Class | Liberty Media vs. E W Scripps | Liberty Media vs. Gray Television |
| ITV PLC vs. ProSiebenSat1 Media AG | ITV PLC vs. RTL Group SA | ITV PLC vs. iHeartMedia | ITV PLC vs. TV Azteca SAB |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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