Correlation Between ProSiebenSat1 Media and Beasley Broadcast
Can any of the company-specific risk be diversified away by investing in both ProSiebenSat1 Media and Beasley Broadcast 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 ProSiebenSat1 Media and Beasley Broadcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProSiebenSat1 Media AG and Beasley Broadcast Group, you can compare the effects of market volatilities on ProSiebenSat1 Media and Beasley Broadcast 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 ProSiebenSat1 Media with a short position of Beasley Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProSiebenSat1 Media and Beasley Broadcast.
Diversification Opportunities for ProSiebenSat1 Media and Beasley Broadcast
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ProSiebenSat1 and Beasley is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding ProSiebenSat1 Media AG and Beasley Broadcast Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beasley Broadcast and ProSiebenSat1 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 ProSiebenSat1 Media AG are associated (or correlated) with Beasley Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beasley Broadcast has no effect on the direction of ProSiebenSat1 Media i.e., ProSiebenSat1 Media and Beasley Broadcast go up and down completely randomly.
Pair Corralation between ProSiebenSat1 Media and Beasley Broadcast
Assuming the 90 days horizon ProSiebenSat1 Media AG is expected to generate 0.78 times more return on investment than Beasley Broadcast. However, ProSiebenSat1 Media AG is 1.29 times less risky than Beasley Broadcast. It trades about -0.38 of its potential returns per unit of risk. Beasley Broadcast Group is currently generating about -0.55 per unit of risk. If you would invest 155.00 in ProSiebenSat1 Media AG on August 24, 2024 and sell it today you would lose (34.00) from holding ProSiebenSat1 Media AG or give up 21.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
ProSiebenSat1 Media AG vs. Beasley Broadcast Group
Performance |
| Timeline |
| ProSiebenSat1 Media |
| Beasley Broadcast |
ProSiebenSat1 Media and Beasley Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProSiebenSat1 Media and Beasley Broadcast
The main advantage of trading using opposite ProSiebenSat1 Media and Beasley Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProSiebenSat1 Media position performs unexpectedly, Beasley Broadcast 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 Beasley Broadcast will offset losses from the drop in Beasley Broadcast's long position.| ProSiebenSat1 Media vs. ITV PLC ADR | ProSiebenSat1 Media vs. iHeartMedia | ProSiebenSat1 Media vs. TV Azteca SAB |
| Beasley Broadcast vs. ProSiebenSat1 Media AG | Beasley Broadcast vs. RTL Group SA | Beasley Broadcast vs. Mediaco Holding | Beasley Broadcast vs. iHeartMedia |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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