Correlation Between News Corp and Formula One
Can any of the company-specific risk be diversified away by investing in both News Corp and Formula One 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 News Corp and Formula One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between News Corp A and Formula One Group, you can compare the effects of market volatilities on News Corp and Formula One 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 News Corp with a short position of Formula One. Check out your portfolio center. Please also check ongoing floating volatility patterns of News Corp and Formula One.
Diversification Opportunities for News Corp and Formula One
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between News and Formula is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding News Corp A and Formula One Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Formula One Group and News Corp 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 News Corp A are associated (or correlated) with Formula One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Formula One Group has no effect on the direction of News Corp i.e., News Corp and Formula One go up and down completely randomly.
Pair Corralation between News Corp and Formula One
If you would invest 2,178 in News Corp A on September 2, 2024 and sell it today you would earn a total of 757.00 from holding News Corp A or generate 34.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
News Corp A vs. Formula One Group
Performance |
| Timeline |
| News Corp A |
| Formula One Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
News Corp and Formula One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with News Corp and Formula One
The main advantage of trading using opposite News Corp and Formula One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if News Corp position performs unexpectedly, Formula One 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 Formula One will offset losses from the drop in Formula One's long position.| News Corp vs. Marcus | News Corp vs. Liberty Media | News Corp vs. Warner Music Group | News Corp vs. Fox Corp Class |
| Formula One vs. Liberty Media | Formula One vs. Atlanta Braves Holdings, | Formula One vs. News Corp B | Formula One vs. News Corp A |
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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