Correlation Between VS Media and Globalstar
Can any of the company-specific risk be diversified away by investing in both VS Media and Globalstar 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 VS Media and Globalstar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VS Media Holdings and Globalstar, you can compare the effects of market volatilities on VS Media and Globalstar 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 VS Media with a short position of Globalstar. Check out your portfolio center. Please also check ongoing floating volatility patterns of VS Media and Globalstar.
Diversification Opportunities for VS Media and Globalstar
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between VSME and Globalstar is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding VS Media Holdings and Globalstar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globalstar and VS Media 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 VS Media Holdings are associated (or correlated) with Globalstar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globalstar has no effect on the direction of VS Media i.e., VS Media and Globalstar go up and down completely randomly.
Pair Corralation between VS Media and Globalstar
Given the investment horizon of 90 days VS Media Holdings is expected to generate 1.1 times more return on investment than Globalstar. However, VS Media is 1.1 times more volatile than Globalstar. It trades about -0.11 of its potential returns per unit of risk. Globalstar is currently generating about -0.17 per unit of risk. If you would invest 122.00 in VS Media Holdings on November 9, 2024 and sell it today you would lose (19.00) from holding VS Media Holdings or give up 15.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VS Media Holdings vs. Globalstar
Performance |
| Timeline |
| VS Media Holdings |
| Globalstar |
VS Media and Globalstar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VS Media and Globalstar
The main advantage of trading using opposite VS Media and Globalstar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VS Media position performs unexpectedly, Globalstar 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 Globalstar will offset losses from the drop in Globalstar's long position.| VS Media vs. Lithium Americas Corp | VS Media vs. Ecovyst | VS Media vs. Air Products and | VS Media vs. Ecolab Inc |
| Globalstar vs. Iridium Communications | Globalstar vs. Lumen Technologies | Globalstar vs. InterDigital | Globalstar vs. Cogent Communications Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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