Correlation Between XLMedia PLC and Centaur Media
Can any of the company-specific risk be diversified away by investing in both XLMedia PLC and Centaur Media 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 XLMedia PLC and Centaur Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XLMedia PLC and Centaur Media, you can compare the effects of market volatilities on XLMedia PLC and Centaur Media 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 XLMedia PLC with a short position of Centaur Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of XLMedia PLC and Centaur Media.
Diversification Opportunities for XLMedia PLC and Centaur Media
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between XLMedia and Centaur is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding XLMedia PLC and Centaur Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centaur Media and XLMedia PLC 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 XLMedia PLC are associated (or correlated) with Centaur Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centaur Media has no effect on the direction of XLMedia PLC i.e., XLMedia PLC and Centaur Media go up and down completely randomly.
Pair Corralation between XLMedia PLC and Centaur Media
Assuming the 90 days trading horizon XLMedia PLC is expected to generate 0.89 times more return on investment than Centaur Media. However, XLMedia PLC is 1.12 times less risky than Centaur Media. It trades about 0.03 of its potential returns per unit of risk. Centaur Media is currently generating about 0.01 per unit of risk. If you would invest 1,175 in XLMedia PLC on August 30, 2024 and sell it today you would earn a total of 10.00 from holding XLMedia PLC or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XLMedia PLC vs. Centaur Media
Performance |
| Timeline |
| XLMedia PLC |
| Centaur Media |
XLMedia PLC and Centaur Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XLMedia PLC and Centaur Media
The main advantage of trading using opposite XLMedia PLC and Centaur Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XLMedia PLC position performs unexpectedly, Centaur Media 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 Centaur Media will offset losses from the drop in Centaur Media's long position.| XLMedia PLC vs. Walmart | XLMedia PLC vs. BYD Co | XLMedia PLC vs. Volkswagen AG | XLMedia PLC vs. Volkswagen AG Non Vtg |
| Centaur Media vs. Walmart | Centaur Media vs. BYD Co | Centaur Media vs. Volkswagen AG | Centaur Media vs. Volkswagen AG Non Vtg |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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