Correlation Between Network Media and Celtic Plc
Can any of the company-specific risk be diversified away by investing in both Network Media and Celtic 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 Network Media and Celtic Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Network Media Group and Celtic plc, you can compare the effects of market volatilities on Network Media and Celtic 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 Network Media with a short position of Celtic Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Network Media and Celtic Plc.
Diversification Opportunities for Network Media and Celtic Plc
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Network and Celtic is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Network Media Group and Celtic plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celtic plc and Network 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 Network Media Group are associated (or correlated) with Celtic Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celtic plc has no effect on the direction of Network Media i.e., Network Media and Celtic Plc go up and down completely randomly.
Pair Corralation between Network Media and Celtic Plc
Assuming the 90 days horizon Network Media Group is expected to under-perform the Celtic Plc. In addition to that, Network Media is 1.4 times more volatile than Celtic plc. It trades about 0.0 of its total potential returns per unit of risk. Celtic plc is currently generating about 0.05 per unit of volatility. If you would invest 97.00 in Celtic plc on August 26, 2024 and sell it today you would earn a total of 113.00 from holding Celtic plc or generate 116.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Network Media Group vs. Celtic plc
Performance |
| Timeline |
| Network Media Group |
| Celtic plc |
Network Media and Celtic Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Network Media and Celtic Plc
The main advantage of trading using opposite Network Media and Celtic Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Network Media position performs unexpectedly, Celtic 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 Celtic Plc will offset losses from the drop in Celtic Plc's long position.| Network Media vs. New Wave Holdings | Network Media vs. ZoomerMedia Limited | Network Media vs. OverActive Media Corp | Network Media vs. Celtic plc |
| Celtic Plc vs. Guild Esports Plc | Celtic Plc vs. ZoomerMedia Limited | Celtic Plc vs. Network Media Group | Celtic Plc vs. OverActive Media Corp |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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