Correlation Between One Media and Young Cos
Can any of the company-specific risk be diversified away by investing in both One Media and Young Cos 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 One Media and Young Cos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between One Media iP and Young Cos Brewery, you can compare the effects of market volatilities on One Media and Young Cos 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 One Media with a short position of Young Cos. Check out your portfolio center. Please also check ongoing floating volatility patterns of One Media and Young Cos.
Diversification Opportunities for One Media and Young Cos
Very good diversification
The 3 months correlation between One and Young is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding One Media iP and Young Cos Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Young Cos Brewery and One 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 One Media iP are associated (or correlated) with Young Cos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Young Cos Brewery has no effect on the direction of One Media i.e., One Media and Young Cos go up and down completely randomly.
Pair Corralation between One Media and Young Cos
Assuming the 90 days trading horizon One Media iP is expected to generate 0.71 times more return on investment than Young Cos. However, One Media iP is 1.41 times less risky than Young Cos. It trades about 0.21 of its potential returns per unit of risk. Young Cos Brewery is currently generating about -0.14 per unit of risk. If you would invest 425.00 in One Media iP on November 7, 2024 and sell it today you would earn a total of 25.00 from holding One Media iP or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
One Media iP vs. Young Cos Brewery
Performance |
| Timeline |
| One Media iP |
| Young Cos Brewery |
One Media and Young Cos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with One Media and Young Cos
The main advantage of trading using opposite One Media and Young Cos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if One Media position performs unexpectedly, Young Cos 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 Young Cos will offset losses from the drop in Young Cos' long position.| One Media vs. Silvercorp Metals | One Media vs. Gamma Communications PLC | One Media vs. Fulcrum Metals PLC | One Media vs. Jacquet Metal Service |
| Young Cos vs. Gamma Communications PLC | Young Cos vs. Geely Automobile Holdings | Young Cos vs. Naked Wines plc | Young Cos vs. Roadside Real Estate |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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