Correlation Between Media and ALM Equity
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By analyzing existing cross correlation between Media and Games and ALM Equity AB, you can compare the effects of market volatilities on Media and ALM Equity 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 Media with a short position of ALM Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media and ALM Equity.
Diversification Opportunities for Media and ALM Equity
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Media and ALM is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Media and Games and ALM Equity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALM Equity AB and 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 Media and Games are associated (or correlated) with ALM Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALM Equity AB has no effect on the direction of Media i.e., Media and ALM Equity go up and down completely randomly.
Pair Corralation between Media and ALM Equity
Assuming the 90 days trading horizon Media and Games is expected to generate 5.58 times more return on investment than ALM Equity. However, Media is 5.58 times more volatile than ALM Equity AB. It trades about 0.02 of its potential returns per unit of risk. ALM Equity AB is currently generating about -0.05 per unit of risk. If you would invest 3,575 in Media and Games on December 29, 2024 and sell it today you would earn a total of 0.00 from holding Media and Games or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Media and Games vs. ALM Equity AB
Performance |
Timeline |
Media and Games |
ALM Equity AB |
Media and ALM Equity Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Media and ALM Equity
The main advantage of trading using opposite Media and ALM Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media position performs unexpectedly, ALM Equity 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 ALM Equity will offset losses from the drop in ALM Equity's long position.Media vs. Embracer Group AB | Media vs. Samhllsbyggnadsbolaget i Norden | Media vs. Sinch AB | Media vs. Zaptec AS |
ALM Equity vs. Vitec Software Group | ALM Equity vs. New Nordic Healthbrands | ALM Equity vs. Online Brands Nordic | ALM Equity vs. MTI Investment SE |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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