Correlation Between Saga Communications and Urban One
Can any of the company-specific risk be diversified away by investing in both Saga Communications and Urban One 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 Urban One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saga Communications and Urban One, you can compare the effects of market volatilities on Saga Communications and Urban One 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 Urban One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saga Communications and Urban One.
Diversification Opportunities for Saga Communications and Urban One
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saga and Urban is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Saga Communications and Urban One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Urban One 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 Urban One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Urban One has no effect on the direction of Saga Communications i.e., Saga Communications and Urban One go up and down completely randomly.
Pair Corralation between Saga Communications and Urban One
Considering the 90-day investment horizon Saga Communications is expected to under-perform the Urban One. But the stock apears to be less risky and, when comparing its historical volatility, Saga Communications is 2.25 times less risky than Urban One. The stock trades about -0.14 of its potential returns per unit of risk. The Urban One is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 136.00 in Urban One on November 27, 2024 and sell it today you would earn a total of 1.00 from holding Urban One or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saga Communications vs. Urban One
Performance |
| Timeline |
| Saga Communications |
| Urban One |
Saga Communications and Urban One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saga Communications and Urban One
The main advantage of trading using opposite Saga Communications and Urban One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saga Communications position performs unexpectedly, Urban One 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 Urban One will offset losses from the drop in Urban One'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 |
| Urban One vs. TVA Group | Urban One vs. Saga Communications | Urban One vs. E W Scripps | Urban One 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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