Correlation Between NORTH MEDIA and ITOCHU

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

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

Diversification Opportunities for NORTH MEDIA and ITOCHU

0.54

Correlation Coefficient

NORTH MEDIA  ITOCHU

Very weak diversification

The 3 months correlation between NORTH and ITOCHU is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding NORTH MEDIA AS and ITOCHU in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITOCHU and NORTH 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 NORTH MEDIA AS are associated (or correlated) with ITOCHU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITOCHU has no effect on the direction of NORTH MEDIA i.e., NORTH MEDIA and ITOCHU go up and down completely randomly.

Pair Corralation between NORTH MEDIA and ITOCHU

Assuming the 90 days horizon NORTH MEDIA AS is expected to generate 1.07 times more return on investment than ITOCHU. However, NORTH MEDIA is 1.07 times more volatile than ITOCHU. It trades about 0.18 of its potential returns per unit of risk. ITOCHU is currently generating about -0.08 per unit of risk. If you would invest  542.00  in NORTH MEDIA AS on April 16, 2025 and sell it today you would earn a total of  30.00  from holding NORTH MEDIA AS or generate 5.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

NORTH MEDIA AS  vs.  ITOCHU

NORTH MEDIA AS

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NORTH MEDIA AS are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, NORTH MEDIA reported solid returns over the last few months and may actually be approaching a breakup point.

ITOCHU

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ITOCHU are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ITOCHU may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with NORTH MEDIA and ITOCHU

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

The idea behind NORTH MEDIA AS and ITOCHU 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.