Correlation Between TOWNSQUARE MEDIA and Impinj
Can any of the company-specific risk be diversified away by investing in both TOWNSQUARE MEDIA and Impinj 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 TOWNSQUARE MEDIA and Impinj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOWNSQUARE MEDIA INC and Impinj Inc, you can compare the effects of market volatilities on TOWNSQUARE MEDIA and Impinj 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 TOWNSQUARE MEDIA with a short position of Impinj. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOWNSQUARE MEDIA and Impinj.
Diversification Opportunities for TOWNSQUARE MEDIA and Impinj
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TOWNSQUARE and Impinj is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding TOWNSQUARE MEDIA INC and Impinj Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impinj Inc and TOWNSQUARE 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 TOWNSQUARE MEDIA INC are associated (or correlated) with Impinj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impinj Inc has no effect on the direction of TOWNSQUARE MEDIA i.e., TOWNSQUARE MEDIA and Impinj go up and down completely randomly.
Pair Corralation between TOWNSQUARE MEDIA and Impinj
Assuming the 90 days trading horizon TOWNSQUARE MEDIA INC is expected to generate 0.37 times more return on investment than Impinj. However, TOWNSQUARE MEDIA INC is 2.69 times less risky than Impinj. It trades about -0.05 of its potential returns per unit of risk. Impinj Inc is currently generating about -0.21 per unit of risk. If you would invest 855.00 in TOWNSQUARE MEDIA INC on November 27, 2024 and sell it today you would lose (25.00) from holding TOWNSQUARE MEDIA INC or give up 2.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TOWNSQUARE MEDIA INC vs. Impinj Inc
Performance |
| Timeline |
| TOWNSQUARE MEDIA INC |
| Impinj Inc |
TOWNSQUARE MEDIA and Impinj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TOWNSQUARE MEDIA and Impinj
The main advantage of trading using opposite TOWNSQUARE MEDIA and Impinj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOWNSQUARE MEDIA position performs unexpectedly, Impinj 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 Impinj will offset losses from the drop in Impinj's long position.| TOWNSQUARE MEDIA vs. PLANT VEDA FOODS | TOWNSQUARE MEDIA vs. Austevoll Seafood ASA | TOWNSQUARE MEDIA vs. SAN MIGUEL BREWERY | TOWNSQUARE MEDIA vs. THAI BEVERAGE |
| Impinj vs. Guangdong Investment Limited | Impinj vs. AGNC Investment Corp | Impinj vs. Magnachip Semiconductor | Impinj vs. SEI Investments |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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