Correlation Between ZINC MEDIA and Platinum Investment
Can any of the company-specific risk be diversified away by investing in both ZINC MEDIA and Platinum Investment 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 ZINC MEDIA and Platinum Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZINC MEDIA GR and Platinum Investment Management, you can compare the effects of market volatilities on ZINC MEDIA and Platinum Investment 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 ZINC MEDIA with a short position of Platinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZINC MEDIA and Platinum Investment.
Diversification Opportunities for ZINC MEDIA and Platinum Investment
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ZINC and Platinum is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding ZINC MEDIA GR and Platinum Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Investment and ZINC 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 ZINC MEDIA GR are associated (or correlated) with Platinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Investment has no effect on the direction of ZINC MEDIA i.e., ZINC MEDIA and Platinum Investment go up and down completely randomly.
Pair Corralation between ZINC MEDIA and Platinum Investment
Assuming the 90 days trading horizon ZINC MEDIA GR is expected to generate 0.93 times more return on investment than Platinum Investment. However, ZINC MEDIA GR is 1.08 times less risky than Platinum Investment. It trades about 0.24 of its potential returns per unit of risk. Platinum Investment Management is currently generating about 0.06 per unit of risk. If you would invest 56.00 in ZINC MEDIA GR on October 14, 2024 and sell it today you would earn a total of 6.00 from holding ZINC MEDIA GR or generate 10.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
ZINC MEDIA GR vs. Platinum Investment Management
Performance |
Timeline |
ZINC MEDIA GR |
Platinum Investment |
ZINC MEDIA and Platinum Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ZINC MEDIA and Platinum Investment
The main advantage of trading using opposite ZINC MEDIA and Platinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZINC MEDIA position performs unexpectedly, Platinum Investment 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 Platinum Investment will offset losses from the drop in Platinum Investment's long position.ZINC MEDIA vs. Methode Electronics | ZINC MEDIA vs. STORE ELECTRONIC | ZINC MEDIA vs. STMICROELECTRONICS | ZINC MEDIA vs. AOI Electronics Co |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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