Correlation Between Telus Corp and News Corp
Can any of the company-specific risk be diversified away by investing in both Telus Corp and News Corp 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 Telus Corp and News Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telus Corp and News Corp A, you can compare the effects of market volatilities on Telus Corp and News Corp 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 Telus Corp with a short position of News Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telus Corp and News Corp.
Diversification Opportunities for Telus Corp and News Corp
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Telus and News is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Telus Corp and News Corp A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on News Corp A and Telus Corp 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 Telus Corp are associated (or correlated) with News Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of News Corp A has no effect on the direction of Telus Corp i.e., Telus Corp and News Corp go up and down completely randomly.
Pair Corralation between Telus Corp and News Corp
Allowing for the 90-day total investment horizon Telus Corp is expected to under-perform the News Corp. But the stock apears to be less risky and, when comparing its historical volatility, Telus Corp is 1.33 times less risky than News Corp. The stock trades about -0.02 of its potential returns per unit of risk. The News Corp A is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,719 in News Corp A on August 30, 2024 and sell it today you would earn a total of 186.00 from holding News Corp A or generate 6.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telus Corp vs. News Corp A
Performance |
| Timeline |
| Telus Corp |
| News Corp A |
Telus Corp and News Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telus Corp and News Corp
The main advantage of trading using opposite Telus Corp and News Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telus Corp position performs unexpectedly, News Corp 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 News Corp will offset losses from the drop in News Corp's long position.| Telus Corp vs. Rogers Communications | Telus Corp vs. Vodafone Group PLC | Telus Corp vs. Orange SA ADR | Telus Corp vs. America Movil SAB |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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