Correlation Between ATRESMEDIA and Trimble
Can any of the company-specific risk be diversified away by investing in both ATRESMEDIA and Trimble 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 ATRESMEDIA and Trimble into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATRESMEDIA and Trimble, you can compare the effects of market volatilities on ATRESMEDIA and Trimble 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 ATRESMEDIA with a short position of Trimble. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATRESMEDIA and Trimble.
Diversification Opportunities for ATRESMEDIA and Trimble
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ATRESMEDIA and Trimble is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding ATRESMEDIA and Trimble in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trimble and ATRESMEDIA 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 ATRESMEDIA are associated (or correlated) with Trimble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trimble has no effect on the direction of ATRESMEDIA i.e., ATRESMEDIA and Trimble go up and down completely randomly.
Pair Corralation between ATRESMEDIA and Trimble
Assuming the 90 days trading horizon ATRESMEDIA is expected to generate 1.69 times less return on investment than Trimble. But when comparing it to its historical volatility, ATRESMEDIA is 1.37 times less risky than Trimble. It trades about 0.08 of its potential returns per unit of risk. Trimble is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,458 in Trimble on September 4, 2024 and sell it today you would earn a total of 2,490 from holding Trimble or generate 55.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATRESMEDIA vs. Trimble
Performance |
| Timeline |
| ATRESMEDIA |
| Trimble |
ATRESMEDIA and Trimble Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATRESMEDIA and Trimble
The main advantage of trading using opposite ATRESMEDIA and Trimble positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATRESMEDIA position performs unexpectedly, Trimble 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 Trimble will offset losses from the drop in Trimble's long position.| ATRESMEDIA vs. TROPHY GAMES DEV | ATRESMEDIA vs. ANGLER GAMING PLC | ATRESMEDIA vs. International Game Technology | ATRESMEDIA vs. Hochschild Mining plc |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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