Correlation Between HT Media and DJ Mediaprint

Can any of the company-specific risk be diversified away by investing in both HT Media and DJ Mediaprint 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 HT Media and DJ Mediaprint into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between HT Media Limited and DJ Mediaprint Logistics, you can compare the effects of market volatilities on HT Media and DJ Mediaprint 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 HT Media with a short position of DJ Mediaprint. Check out your portfolio center. Please also check ongoing floating volatility patterns of HT Media and DJ Mediaprint.

Diversification Opportunities for HT Media and DJ Mediaprint

-0.18

Correlation Coefficient

HT Media  DJ Mediaprint

Good diversification

The 3 months correlation between HTMEDIA and DJML is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding HT Media Limited and DJ Mediaprint Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DJ Mediaprint Logistics and HT 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 HT Media Limited are associated (or correlated) with DJ Mediaprint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DJ Mediaprint Logistics has no effect on the direction of HT Media i.e., HT Media and DJ Mediaprint go up and down completely randomly.

Pair Corralation between HT Media and DJ Mediaprint

Assuming the 90 days trading horizon HT Media is expected to generate 29.66 times less return on investment than DJ Mediaprint. But when comparing it to its historical volatility, HT Media Limited is 7.61 times less risky than DJ Mediaprint. It trades about 0.02 of its potential returns per unit of risk. DJ Mediaprint Logistics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  5,189  in DJ Mediaprint Logistics on October 10, 2024 and sell it today you would earn a total of  11,817  from holding DJ Mediaprint Logistics or generate 227.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

HT Media Limited  vs.  DJ Mediaprint Logistics

HT Media Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HT Media Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, HT Media is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

DJ Mediaprint Logistics

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in DJ Mediaprint Logistics are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, DJ Mediaprint unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HT Media and DJ Mediaprint

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

The idea behind HT Media Limited and DJ Mediaprint Logistics 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.