Correlation Between Media and Elis SA
Can any of the company-specific risk be diversified away by investing in both Media and Elis SA 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 Media and Elis SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media and Games and Elis SA, you can compare the effects of market volatilities on Media and Elis SA 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 Media with a short position of Elis SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media and Elis SA.
Diversification Opportunities for Media and Elis SA
Good diversification
The 3 months correlation between Media and Elis is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Media and Games and Elis SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elis SA and 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 Media and Games are associated (or correlated) with Elis SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elis SA has no effect on the direction of Media i.e., Media and Elis SA go up and down completely randomly.
Pair Corralation between Media and Elis SA
Assuming the 90 days trading horizon Media and Games is expected to generate 2.34 times more return on investment than Elis SA. However, Media is 2.34 times more volatile than Elis SA. It trades about 0.06 of its potential returns per unit of risk. Elis SA is currently generating about 0.06 per unit of risk. If you would invest 155.00 in Media and Games on September 2, 2024 and sell it today you would earn a total of 186.00 from holding Media and Games or generate 120.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media and Games vs. Elis SA
Performance |
| Timeline |
| Media and Games |
| Elis SA |
Media and Elis SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media and Elis SA
The main advantage of trading using opposite Media and Elis SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media position performs unexpectedly, Elis SA 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 Elis SA will offset losses from the drop in Elis SA's long position.| Media vs. Clearside Biomedical | Media vs. Japan Medical Dynamic | Media vs. Apollo Medical Holdings | Media vs. BRIT AMER TOBACCO |
| Elis SA vs. Games Workshop Group | Elis SA vs. FRACTAL GAMING GROUP | Elis SA vs. Media and Games | Elis SA vs. GEELY AUTOMOBILE |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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