Correlation Between Beasley Broadcast and Clear Channel
Can any of the company-specific risk be diversified away by investing in both Beasley Broadcast and Clear Channel 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 Beasley Broadcast and Clear Channel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beasley Broadcast Group and Clear Channel Outdoor, you can compare the effects of market volatilities on Beasley Broadcast and Clear Channel 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 Beasley Broadcast with a short position of Clear Channel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beasley Broadcast and Clear Channel.
Diversification Opportunities for Beasley Broadcast and Clear Channel
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beasley and Clear is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Beasley Broadcast Group and Clear Channel Outdoor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clear Channel Outdoor and Beasley Broadcast 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 Beasley Broadcast Group are associated (or correlated) with Clear Channel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clear Channel Outdoor has no effect on the direction of Beasley Broadcast i.e., Beasley Broadcast and Clear Channel go up and down completely randomly.
Pair Corralation between Beasley Broadcast and Clear Channel
Given the investment horizon of 90 days Beasley Broadcast Group is expected to under-perform the Clear Channel. In addition to that, Beasley Broadcast is 1.13 times more volatile than Clear Channel Outdoor. It trades about -0.16 of its total potential returns per unit of risk. Clear Channel Outdoor is currently generating about -0.08 per unit of volatility. If you would invest 154.00 in Clear Channel Outdoor on January 26, 2024 and sell it today you would lose (10.00) from holding Clear Channel Outdoor or give up 6.49% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Beasley Broadcast Group vs. Clear Channel Outdoor
Performance |
Timeline |
Beasley Broadcast |
Clear Channel Outdoor |
Beasley Broadcast and Clear Channel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Beasley Broadcast and Clear Channel
The main advantage of trading using opposite Beasley Broadcast and Clear Channel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beasley Broadcast position performs unexpectedly, Clear Channel 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 Clear Channel will offset losses from the drop in Clear Channel's long position.Beasley Broadcast vs. ProSiebenSat1 Media AG | Beasley Broadcast vs. RTL Group SA | Beasley Broadcast vs. iHeartMedia | Beasley Broadcast vs. Liberty Media |
Clear Channel vs. Townsquare Media | Clear Channel vs. Dolphin Entertainment | Clear Channel vs. MGO Global Common |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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