Correlation Between Audacy and Gray Television

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

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

Diversification Opportunities for Audacy and Gray Television

0.0

Correlation Coefficient

Audacy  Gray Television

Pay attention - limited upside

The 3 months correlation between Audacy and Gray is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Audacy Inc and Gray Television in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gray Television and Audacy 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 Audacy Inc are associated (or correlated) with Gray Television. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gray Television has no effect on the direction of Audacy i.e., Audacy and Gray Television go up and down completely randomly.

Pair Corralation between Audacy and Gray Television

If you would invest (100.00) in Audacy Inc on September 3, 2024 and sell it today you would earn a total of  100.00  from holding Audacy Inc or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Audacy Inc  vs.  Gray Television

Audacy Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Audacy Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Audacy is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Gray Television

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gray Television has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Audacy and Gray Television

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

The idea behind Audacy Inc and Gray Television 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.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.