Correlation Between Saga Communications and Tegna
Can any of the company-specific risk be diversified away by investing in both Saga Communications and Tegna 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 Tegna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saga Communications and Tegna Inc, you can compare the effects of market volatilities on Saga Communications and Tegna 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 Tegna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saga Communications and Tegna.
Diversification Opportunities for Saga Communications and Tegna
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Saga and Tegna is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Saga Communications and Tegna Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tegna Inc 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 Tegna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tegna Inc has no effect on the direction of Saga Communications i.e., Saga Communications and Tegna go up and down completely randomly.
Pair Corralation between Saga Communications and Tegna
Considering the 90-day investment horizon Saga Communications is expected to under-perform the Tegna. But the stock apears to be less risky and, when comparing its historical volatility, Saga Communications is 1.31 times less risky than Tegna. The stock trades about -0.16 of its potential returns per unit of risk. The Tegna Inc is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,650 in Tegna Inc on August 27, 2024 and sell it today you would earn a total of 244.00 from holding Tegna Inc or generate 14.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saga Communications vs. Tegna Inc
Performance |
| Timeline |
| Saga Communications |
| Tegna Inc |
Saga Communications and Tegna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saga Communications and Tegna
The main advantage of trading using opposite Saga Communications and Tegna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saga Communications position performs unexpectedly, Tegna 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 Tegna will offset losses from the drop in Tegna'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 |
| Tegna vs. E W Scripps | Tegna vs. Gray Television | Tegna vs. iHeartMedia Class A | Tegna 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 CEOs Directory module to screen CEOs from public companies around the world.
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