Correlation Between Network Media and New Wave

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

By analyzing existing cross correlation between Network Media Group and New Wave Holdings, you can compare the effects of market volatilities on Network Media and New Wave 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 Network Media with a short position of New Wave. Check out your portfolio center. Please also check ongoing floating volatility patterns of Network Media and New Wave.

Diversification Opportunities for Network Media and New Wave

-0.56

Correlation Coefficient

Network Media  New Wave

Excellent diversification

The 3 months correlation between Network and New is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Network Media Group and New Wave Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Wave Holdings and Network 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 Network Media Group are associated (or correlated) with New Wave. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Wave Holdings has no effect on the direction of Network Media i.e., Network Media and New Wave go up and down completely randomly.

Pair Corralation between Network Media and New Wave

Assuming the 90 days horizon Network Media is expected to generate 175.69 times less return on investment than New Wave. But when comparing it to its historical volatility, Network Media Group is 8.37 times less risky than New Wave. It trades about 0.01 of its potential returns per unit of risk. New Wave Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  12.00  in New Wave Holdings on July 11, 2025 and sell it today you would earn a total of  37.00  from holding New Wave Holdings or generate 308.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.8%
Values	Daily Returns

Network Media Group  vs.  New Wave Holdings

Network Media Group

Risk-Adjusted Performance

Weakest

Over the last 90 days Network Media Group 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 nearly stable which may send shares a bit higher in November 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

New Wave Holdings

Risk-Adjusted Performance

Solid

Over the last 90 days New Wave Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile basic indicators, New Wave reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Network Media and New Wave

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

The idea behind Network Media Group and New Wave Holdings 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.