Correlation Between Saga Communications and Gray Television
Can any of the company-specific risk be diversified away by investing in both Saga Communications and Gray Television 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 Saga Communications and Gray Television into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saga Communications and Gray Television, you can compare the effects of market volatilities on Saga Communications and Gray Television 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 Saga Communications with a short position of Gray Television. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saga Communications and Gray Television.
Diversification Opportunities for Saga Communications and Gray Television
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Saga and Gray is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Saga Communications and Gray Television in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gray Television and Saga Communications 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 Saga Communications are associated (or correlated) with Gray Television. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gray Television has no effect on the direction of Saga Communications i.e., Saga Communications and Gray Television go up and down completely randomly.
Pair Corralation between Saga Communications and Gray Television
Considering the 90-day investment horizon Saga Communications is expected to generate 0.39 times more return on investment than Gray Television. However, Saga Communications is 2.58 times less risky than Gray Television. It trades about -0.16 of its potential returns per unit of risk. Gray Television is currently generating about -0.15 per unit of risk. If you would invest 1,445 in Saga Communications on August 27, 2024 and sell it today you would lose (126.00) from holding Saga Communications or give up 8.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saga Communications vs. Gray Television
Performance |
| Timeline |
| Saga Communications |
| Gray Television |
Saga Communications and Gray Television Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saga Communications and Gray Television
The main advantage of trading using opposite Saga Communications and Gray Television positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saga Communications position performs unexpectedly, Gray Television 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 Gray Television will offset losses from the drop in Gray Television's long position.| Saga Communications vs. iHeartMedia Class A | Saga Communications vs. Beasley Broadcast Group | Saga Communications vs. Cumulus Media Class | Saga Communications vs. Mediaco Holding |
| Gray Television vs. E W Scripps | Gray Television vs. Saga Communications | Gray Television vs. iHeartMedia Class A | Gray Television vs. Cumulus Media Class |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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