Correlation Between Media and Saniona AB

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

By analyzing existing cross correlation between Media and Games and Saniona AB TO, you can compare the effects of market volatilities on Media and Saniona AB 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 Saniona AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media and Saniona AB.

Diversification Opportunities for Media and Saniona AB

0.43

Correlation Coefficient

Media  Saniona AB

Very weak diversification

The 3 months correlation between Media and Saniona is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Media and Games and Saniona AB TO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saniona AB TO 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 Saniona AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saniona AB TO has no effect on the direction of Media i.e., Media and Saniona AB go up and down completely randomly.

Pair Corralation between Media and Saniona AB

Assuming the 90 days trading horizon Media and Games is expected to generate 0.58 times more return on investment than Saniona AB. However, Media and Games is 1.71 times less risky than Saniona AB. It trades about 0.02 of its potential returns per unit of risk. Saniona AB TO is currently generating about -0.1 per unit of risk. If you would invest  3,665  in Media and Games on December 25, 2024 and sell it today you would earn a total of  40.00  from holding Media and Games or generate 1.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

Media and Games  vs.  Saniona AB TO

Media and Games

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Media and Games are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Media is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Saniona AB TO

Risk-Adjusted Performance

Very Weak

Over the last 90 days Saniona AB TO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Media and Saniona AB

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

The idea behind Media and Games and Saniona AB TO 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.