Correlation Between Fox Corp and E W

Can any of the company-specific risk be diversified away by investing in both Fox Corp and E W 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 Fox Corp and E W into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fox Corp Class and E W Scripps, you can compare the effects of market volatilities on Fox Corp and E W 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 Fox Corp with a short position of E W. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fox Corp and E W.

Diversification Opportunities for Fox Corp and E W

-0.62

Correlation Coefficient

Fox Corp  E W

Excellent diversification

The 3 months correlation between Fox and SSP is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Fox Corp Class and E W Scripps in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on E W Scripps and Fox Corp 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 Fox Corp Class are associated (or correlated) with E W. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of E W Scripps has no effect on the direction of Fox Corp i.e., Fox Corp and E W go up and down completely randomly.

Pair Corralation between Fox Corp and E W

Considering the 90-day investment horizon Fox Corp Class is expected to under-perform the E W. But the stock apears to be less risky and, when comparing its historical volatility, Fox Corp Class is 7.27 times less risky than E W. The stock trades about -0.13 of its potential returns per unit of risk. The E W Scripps is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  187.00  in E W Scripps on October 23, 2024 and sell it today you would earn a total of  41.00  from holding E W Scripps or generate 21.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Fox Corp Class  vs.  E W Scripps

Fox Corp Class

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fox Corp Class are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Fox Corp showed solid returns over the last few months and may actually be approaching a breakup point.

E W Scripps

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in E W Scripps are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, E W may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Fox Corp and E W

The main advantage of trading using opposite Fox Corp and E W positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fox Corp position performs unexpectedly, E W 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 E W will offset losses from the drop in E W's long position.

The idea behind Fox Corp Class and E W Scripps pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.