Correlation Between Warner Bros and Tegna
Can any of the company-specific risk be diversified away by investing in both Warner Bros 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 Warner Bros and Tegna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Warner Bros Discovery and Tegna Inc, you can compare the effects of market volatilities on Warner Bros 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 Warner Bros with a short position of Tegna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Warner Bros and Tegna.
Diversification Opportunities for Warner Bros and Tegna
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Warner and Tegna is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Warner Bros Discovery and Tegna Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tegna Inc and Warner Bros 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 Warner Bros Discovery 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 Warner Bros i.e., Warner Bros and Tegna go up and down completely randomly.
Pair Corralation between Warner Bros and Tegna
Considering the 90-day investment horizon Warner Bros is expected to generate 1.05 times less return on investment than Tegna. In addition to that, Warner Bros is 1.48 times more volatile than Tegna Inc. It trades about 0.06 of its total potential returns per unit of risk. Tegna Inc is currently generating about 0.1 per unit of volatility. If you would invest 1,465 in Tegna Inc on August 30, 2024 and sell it today you would earn a total of 400.00 from holding Tegna Inc or generate 27.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Warner Bros Discovery vs. Tegna Inc
Performance |
| Timeline |
| Warner Bros Discovery |
| Tegna Inc |
Warner Bros and Tegna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Warner Bros and Tegna
The main advantage of trading using opposite Warner Bros and Tegna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Warner Bros 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.| Warner Bros vs. Walt Disney | Warner Bros vs. Roku Inc | Warner Bros vs. Netflix | Warner Bros vs. Paramount Global Class |
| Tegna vs. News Corp B | Tegna vs. News Corp A | Tegna vs. Live Nation Entertainment | Tegna vs. Paramount Global 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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |