Correlation Between Exela Technologies and North Media
Can any of the company-specific risk be diversified away by investing in both Exela Technologies and North Media 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 Exela Technologies and North Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exela Technologies and North Media AS, you can compare the effects of market volatilities on Exela Technologies and North Media 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 Exela Technologies with a short position of North Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exela Technologies and North Media.
Diversification Opportunities for Exela Technologies and North Media
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Exela and North is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Exela Technologies and North Media AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Media AS and Exela Technologies 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 Exela Technologies are associated (or correlated) with North Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Media AS has no effect on the direction of Exela Technologies i.e., Exela Technologies and North Media go up and down completely randomly.
Pair Corralation between Exela Technologies and North Media
Given the investment horizon of 90 days Exela Technologies is expected to under-perform the North Media. In addition to that, Exela Technologies is 5.09 times more volatile than North Media AS. It trades about -0.02 of its total potential returns per unit of risk. North Media AS is currently generating about 0.05 per unit of volatility. If you would invest 5,366 in North Media AS on December 29, 2023 and sell it today you would earn a total of 1,054 from holding North Media AS or generate 19.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 99.63% |
Values | Daily Returns |
Exela Technologies vs. North Media AS
Performance |
Timeline |
Exela Technologies |
North Media AS |
Exela Technologies and North Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Exela Technologies and North Media
The main advantage of trading using opposite Exela Technologies and North Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exela Technologies position performs unexpectedly, North Media 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 North Media will offset losses from the drop in North Media's long position.Exela Technologies vs. Unity Software | Exela Technologies vs. Daily Journal Corp | Exela Technologies vs. C3 Ai Inc | Exela Technologies vs. Blackline |
North Media vs. Novo Nordisk AS | North Media vs. Danske Bank AS | North Media vs. AP Mller | North Media vs. AP Mller |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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