Correlation Between Grupo Televisa and RTL Group
Can any of the company-specific risk be diversified away by investing in both Grupo Televisa and RTL Group 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 Grupo Televisa and RTL Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Televisa SAB and RTL Group SA, you can compare the effects of market volatilities on Grupo Televisa and RTL Group 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 Grupo Televisa with a short position of RTL Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Televisa and RTL Group.
Diversification Opportunities for Grupo Televisa and RTL Group
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grupo and RTL is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Televisa SAB and RTL Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RTL Group SA and Grupo Televisa 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 Grupo Televisa SAB are associated (or correlated) with RTL Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RTL Group SA has no effect on the direction of Grupo Televisa i.e., Grupo Televisa and RTL Group go up and down completely randomly.
Pair Corralation between Grupo Televisa and RTL Group
Assuming the 90 days horizon Grupo Televisa SAB is expected to under-perform the RTL Group. But the pink sheet apears to be less risky and, when comparing its historical volatility, Grupo Televisa SAB is 1.04 times less risky than RTL Group. The pink sheet trades about -0.06 of its potential returns per unit of risk. The RTL Group SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 425.00 in RTL Group SA on December 29, 2023 and sell it today you would lose (80.00) from holding RTL Group SA or give up 18.82% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Grupo Televisa SAB vs. RTL Group SA
Performance |
Timeline |
Grupo Televisa SAB |
RTL Group SA |
Grupo Televisa and RTL Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Grupo Televisa and RTL Group
The main advantage of trading using opposite Grupo Televisa and RTL Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Televisa position performs unexpectedly, RTL Group 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 RTL Group will offset losses from the drop in RTL Group's long position.Grupo Televisa vs. Verizon Communications | Grupo Televisa vs. International Business Machines | Grupo Televisa vs. ATT Inc | Grupo Televisa vs. Comcast Corp |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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