Correlation Between RCS MediaGroup and Premium Nickel
Can any of the company-specific risk be diversified away by investing in both RCS MediaGroup and Premium Nickel 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 RCS MediaGroup and Premium Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RCS MediaGroup SpA and Premium Nickel Resources, you can compare the effects of market volatilities on RCS MediaGroup and Premium Nickel 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 RCS MediaGroup with a short position of Premium Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCS MediaGroup and Premium Nickel.
Diversification Opportunities for RCS MediaGroup and Premium Nickel
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RCS and Premium is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and Premium Nickel Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premium Nickel Resources and RCS MediaGroup 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 RCS MediaGroup SpA are associated (or correlated) with Premium Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premium Nickel Resources has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and Premium Nickel go up and down completely randomly.
Pair Corralation between RCS MediaGroup and Premium Nickel
Assuming the 90 days horizon RCS MediaGroup SpA is expected to generate 0.28 times more return on investment than Premium Nickel. However, RCS MediaGroup SpA is 3.55 times less risky than Premium Nickel. It trades about 0.2 of its potential returns per unit of risk. Premium Nickel Resources is currently generating about -0.22 per unit of risk. If you would invest 85.00 in RCS MediaGroup SpA on September 19, 2024 and sell it today you would earn a total of 8.00 from holding RCS MediaGroup SpA or generate 9.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
RCS MediaGroup SpA vs. Premium Nickel Resources
Performance |
| Timeline |
| RCS MediaGroup SpA |
| Premium Nickel Resources |
RCS MediaGroup and Premium Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCS MediaGroup and Premium Nickel
The main advantage of trading using opposite RCS MediaGroup and Premium Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCS MediaGroup position performs unexpectedly, Premium Nickel 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 Premium Nickel will offset losses from the drop in Premium Nickel's long position.| RCS MediaGroup vs. Legible | RCS MediaGroup vs. Sylvania Platinum Limited | RCS MediaGroup vs. Thunderbird Entertainment Group | RCS MediaGroup vs. PAX Global Technology |
| Premium Nickel vs. Playtika Holding Corp | Premium Nickel vs. PennantPark Investment | Premium Nickel vs. Comstock Holding Companies | Premium Nickel vs. RCS MediaGroup SpA |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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