Correlation Between Reinsurance Group and Media
Can any of the company-specific risk be diversified away by investing in both Reinsurance Group and Media 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 Reinsurance Group and Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Reinsurance Group of and Media and Games, you can compare the effects of market volatilities on Reinsurance Group and Media 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 Reinsurance Group with a short position of Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Reinsurance Group and Media.
Diversification Opportunities for Reinsurance Group and Media
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Reinsurance and Media is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Reinsurance Group of and Media and Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media and Games and Reinsurance Group 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 Reinsurance Group of are associated (or correlated) with Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media and Games has no effect on the direction of Reinsurance Group i.e., Reinsurance Group and Media go up and down completely randomly.
Pair Corralation between Reinsurance Group and Media
Assuming the 90 days trading horizon Reinsurance Group of is expected to generate 0.59 times more return on investment than Media. However, Reinsurance Group of is 1.69 times less risky than Media. It trades about 0.09 of its potential returns per unit of risk. Media and Games is currently generating about -0.22 per unit of risk. If you would invest 20,200 in Reinsurance Group of on October 11, 2024 and sell it today you would earn a total of 600.00 from holding Reinsurance Group of or generate 2.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Reinsurance Group of vs. Media and Games
Performance |
| Timeline |
| Reinsurance Group |
| Media and Games |
Reinsurance Group and Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Reinsurance Group and Media
The main advantage of trading using opposite Reinsurance Group and Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Reinsurance Group position performs unexpectedly, Media 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 Media will offset losses from the drop in Media's long position.| Reinsurance Group vs. CAIRN HOMES EO | Reinsurance Group vs. JAPAN AIRLINES | Reinsurance Group vs. Neinor Homes SA | Reinsurance Group vs. Focus Home Interactive |
| Media vs. BURLINGTON STORES | Media vs. Cogent Communications Holdings | Media vs. T MOBILE INCDL 00001 | Media vs. Iridium Communications |
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.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |