Correlation Between RCS MediaGroup and ZINC MEDIA

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

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

Diversification Opportunities for RCS MediaGroup and ZINC MEDIA

0.03

Correlation Coefficient

RCS MediaGroup  ZINC MEDIA

Significant diversification

The 3 months correlation between RCS and ZINC is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and ZINC MEDIA GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZINC MEDIA GR and RCS MediaGroup 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 RCS MediaGroup SpA are associated (or correlated) with ZINC MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZINC MEDIA GR has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and ZINC MEDIA go up and down completely randomly.

Pair Corralation between RCS MediaGroup and ZINC MEDIA

Assuming the 90 days trading horizon RCS MediaGroup is expected to generate 1.37 times less return on investment than ZINC MEDIA. In addition to that, RCS MediaGroup is 1.25 times more volatile than ZINC MEDIA GR. It trades about 0.07 of its total potential returns per unit of risk. ZINC MEDIA GR is currently generating about 0.13 per unit of volatility. If you would invest  67.00  in ZINC MEDIA GR on April 24, 2025 and sell it today you would earn a total of  12.00  from holding ZINC MEDIA GR or generate 17.91% return on investment over 90 days.

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

RCS MediaGroup SpA  vs.  ZINC MEDIA GR

RCS MediaGroup SpA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in RCS MediaGroup SpA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, RCS MediaGroup reported solid returns over the last few months and may actually be approaching a breakup point.

ZINC MEDIA GR

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ZINC MEDIA GR are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ZINC MEDIA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with RCS MediaGroup and ZINC MEDIA

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

The idea behind RCS MediaGroup SpA and ZINC MEDIA GR 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.