Correlation Between Liberty Media and Gray Television
Can any of the company-specific risk be diversified away by investing in both Liberty Media and Gray Television 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 Gray Television into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Media and Gray Television, you can compare the effects of market volatilities on Liberty Media and Gray Television 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 Gray Television. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Media and Gray Television.
Diversification Opportunities for Liberty Media and Gray Television
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Liberty and Gray is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Media and Gray Television in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gray Television 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 Gray Television. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gray Television has no effect on the direction of Liberty Media i.e., Liberty Media and Gray Television go up and down completely randomly.
Pair Corralation between Liberty Media and Gray Television
Assuming the 90 days horizon Liberty Media is expected to under-perform the Gray Television. But the stock apears to be less risky and, when comparing its historical volatility, Liberty Media is 1.73 times less risky than Gray Television. The stock trades about -0.05 of its potential returns per unit of risk. The Gray Television is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,050 in Gray Television on August 24, 2024 and sell it today you would lose (613.00) from holding Gray Television or give up 58.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 87.9% |
| Values | Daily Returns |
Liberty Media vs. Gray Television
Performance |
| Timeline |
| Liberty Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Gray Television |
Liberty Media and Gray Television Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Media and Gray Television
The main advantage of trading using opposite Liberty Media and Gray Television positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Media position performs unexpectedly, Gray Television 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 Gray Television will offset losses from the drop in Gray Television's long position.| Liberty Media vs. E W Scripps | Liberty Media vs. Gray Television | Liberty Media vs. Cumulus Media Class | Liberty Media vs. Beasley Broadcast Group |
| Gray Television vs. E W Scripps | Gray Television vs. Saga Communications | Gray Television vs. iHeartMedia Class A | Gray Television vs. Cumulus Media Class |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Global Correlations Find global opportunities by holding instruments from different markets |