Correlation Between Media Times and AKD Hospitality
Can any of the company-specific risk be diversified away by investing in both Media Times and AKD Hospitality 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 Times and AKD Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media Times and AKD Hospitality, you can compare the effects of market volatilities on Media Times and AKD Hospitality 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 Times with a short position of AKD Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media Times and AKD Hospitality.
Diversification Opportunities for Media Times and AKD Hospitality
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Media and AKD is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Media Times and AKD Hospitality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AKD Hospitality and Media Times 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 Times are associated (or correlated) with AKD Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AKD Hospitality has no effect on the direction of Media Times i.e., Media Times and AKD Hospitality go up and down completely randomly.
Pair Corralation between Media Times and AKD Hospitality
Assuming the 90 days trading horizon Media Times is expected to generate 1.64 times more return on investment than AKD Hospitality. However, Media Times is 1.64 times more volatile than AKD Hospitality. It trades about 0.2 of its potential returns per unit of risk. AKD Hospitality is currently generating about 0.08 per unit of risk. If you would invest 184.00 in Media Times on September 1, 2024 and sell it today you would earn a total of 39.00 from holding Media Times or generate 21.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media Times vs. AKD Hospitality
Performance |
| Timeline |
| Media Times |
| AKD Hospitality |
Media Times and AKD Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media Times and AKD Hospitality
The main advantage of trading using opposite Media Times and AKD Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media Times position performs unexpectedly, AKD Hospitality 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 AKD Hospitality will offset losses from the drop in AKD Hospitality's long position.| Media Times vs. Ghani Chemical Industries | Media Times vs. Synthetic Products Enterprises | Media Times vs. United Insurance | Media Times vs. Quice Food Industries |
| AKD Hospitality vs. Habib Insurance | AKD Hospitality vs. Century Insurance | AKD Hospitality vs. Reliance Weaving Mills | AKD Hospitality vs. Media Times |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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