Correlation Between Zinc Media and Hershey
Can any of the company-specific risk be diversified away by investing in both Zinc Media and Hershey 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 Hershey into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zinc Media Group and Hershey Co, you can compare the effects of market volatilities on Zinc Media and Hershey 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 Hershey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zinc Media and Hershey.
Diversification Opportunities for Zinc Media and Hershey
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Zinc and Hershey is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Zinc Media Group and Hershey Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hershey 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 Group are associated (or correlated) with Hershey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hershey has no effect on the direction of Zinc Media i.e., Zinc Media and Hershey go up and down completely randomly.
Pair Corralation between Zinc Media and Hershey
Assuming the 90 days trading horizon Zinc Media Group is expected to generate 1.84 times more return on investment than Hershey. However, Zinc Media is 1.84 times more volatile than Hershey Co. It trades about 0.25 of its potential returns per unit of risk. Hershey Co is currently generating about -0.52 per unit of risk. If you would invest 5,100 in Zinc Media Group on October 14, 2024 and sell it today you would earn a total of 550.00 from holding Zinc Media Group or generate 10.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Zinc Media Group vs. Hershey Co
Performance |
| Timeline |
| Zinc Media Group |
| Hershey |
Zinc Media and Hershey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zinc Media and Hershey
The main advantage of trading using opposite Zinc Media and Hershey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zinc Media position performs unexpectedly, Hershey 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 Hershey will offset losses from the drop in Hershey's long position.| Zinc Media vs. Compagnie Plastic Omnium | Zinc Media vs. Zurich Insurance Group | Zinc Media vs. JD Sports Fashion | Zinc Media vs. UNIQA Insurance Group |
| Hershey vs. Ryanair Holdings plc | Hershey vs. Tyson Foods Cl | Hershey vs. Sligro Food Group | Hershey vs. Norwegian Air Shuttle |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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