Correlation Between Tegna and Klépierre
Can any of the company-specific risk be diversified away by investing in both Tegna and Klépierre 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 Tegna and Klépierre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tegna Inc and Klpierre SA, you can compare the effects of market volatilities on Tegna and Klépierre 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 Tegna with a short position of Klépierre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tegna and Klépierre.
Diversification Opportunities for Tegna and Klépierre
Excellent diversification
The 3 months correlation between Tegna and Klépierre is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Tegna Inc and Klpierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klpierre SA and Tegna 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 Tegna Inc are associated (or correlated) with Klépierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klpierre SA has no effect on the direction of Tegna i.e., Tegna and Klépierre go up and down completely randomly.
Pair Corralation between Tegna and Klépierre
Given the investment horizon of 90 days Tegna Inc is expected to under-perform the Klépierre. In addition to that, Tegna is 1.17 times more volatile than Klpierre SA. It trades about -0.14 of its total potential returns per unit of risk. Klpierre SA is currently generating about 0.12 per unit of volatility. If you would invest 2,900 in Klpierre SA on November 4, 2024 and sell it today you would earn a total of 62.00 from holding Klpierre SA or generate 2.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tegna Inc vs. Klpierre SA
Performance |
| Timeline |
| Tegna Inc |
| Klpierre SA |
Tegna and Klépierre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tegna and Klépierre
The main advantage of trading using opposite Tegna and Klépierre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tegna position performs unexpectedly, Klépierre 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 Klépierre will offset losses from the drop in Klépierre's long position.| Tegna vs. E W Scripps | Tegna vs. Gray Television | Tegna vs. iHeartMedia Class A | Tegna vs. Cumulus Media Class |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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