Correlation Between ATRESMEDIA and KBC ANCORA

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

By analyzing existing cross correlation between ATRESMEDIA and KBC ANCORA, you can compare the effects of market volatilities on ATRESMEDIA and KBC ANCORA 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 ATRESMEDIA with a short position of KBC ANCORA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATRESMEDIA and KBC ANCORA.

Diversification Opportunities for ATRESMEDIA and KBC ANCORA

0.42

Correlation Coefficient

ATRESMEDIA  KBC ANCORA

Very weak diversification

The 3 months correlation between ATRESMEDIA and KBC is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding ATRESMEDIA and KBC ANCORA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBC ANCORA and ATRESMEDIA 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 ATRESMEDIA are associated (or correlated) with KBC ANCORA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBC ANCORA has no effect on the direction of ATRESMEDIA i.e., ATRESMEDIA and KBC ANCORA go up and down completely randomly.

Pair Corralation between ATRESMEDIA and KBC ANCORA

Assuming the 90 days trading horizon ATRESMEDIA is expected to generate 1.4 times more return on investment than KBC ANCORA. However, ATRESMEDIA is 1.4 times more volatile than KBC ANCORA. It trades about 0.22 of its potential returns per unit of risk. KBC ANCORA is currently generating about 0.02 per unit of risk. If you would invest  419.00  in ATRESMEDIA on October 25, 2024 and sell it today you would earn a total of  21.00  from holding ATRESMEDIA or generate 5.01% return on investment over 90 days.

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

ATRESMEDIA  vs.  KBC ANCORA

ATRESMEDIA

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ATRESMEDIA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, ATRESMEDIA is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

KBC ANCORA

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KBC ANCORA are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, KBC ANCORA may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with ATRESMEDIA and KBC ANCORA

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

The idea behind ATRESMEDIA and KBC ANCORA 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.