Correlation Between ANGI Homeservices and Meta Platforms
Can any of the company-specific risk be diversified away by investing in both ANGI Homeservices and Meta Platforms 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 ANGI Homeservices and Meta Platforms into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANGI Homeservices and Meta Platforms, you can compare the effects of market volatilities on ANGI Homeservices and Meta Platforms 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 ANGI Homeservices with a short position of Meta Platforms. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANGI Homeservices and Meta Platforms.
Diversification Opportunities for ANGI Homeservices and Meta Platforms
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ANGI and Meta is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding ANGI Homeservices and Meta Platforms in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meta Platforms and ANGI Homeservices 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 ANGI Homeservices are associated (or correlated) with Meta Platforms. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meta Platforms has no effect on the direction of ANGI Homeservices i.e., ANGI Homeservices and Meta Platforms go up and down completely randomly.
Pair Corralation between ANGI Homeservices and Meta Platforms
Given the investment horizon of 90 days ANGI Homeservices is expected to under-perform the Meta Platforms. In addition to that, ANGI Homeservices is 3.92 times more volatile than Meta Platforms. It trades about -0.09 of its total potential returns per unit of risk. Meta Platforms is currently generating about -0.08 per unit of volatility. If you would invest 57,816 in Meta Platforms on August 27, 2024 and sell it today you would lose (1,902) from holding Meta Platforms or give up 3.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANGI Homeservices vs. Meta Platforms
Performance |
| Timeline |
| ANGI Homeservices |
| Meta Platforms |
ANGI Homeservices and Meta Platforms Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANGI Homeservices and Meta Platforms
The main advantage of trading using opposite ANGI Homeservices and Meta Platforms positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANGI Homeservices position performs unexpectedly, Meta Platforms 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 Meta Platforms will offset losses from the drop in Meta Platforms' long position.| ANGI Homeservices vs. Match Group | ANGI Homeservices vs. Outbrain | ANGI Homeservices vs. MediaAlpha | ANGI Homeservices vs. YY Inc Class |
| Meta Platforms vs. Alphabet Inc Class A | Meta Platforms vs. Twilio Inc | Meta Platforms vs. Snap Inc | Meta Platforms vs. Baidu Inc |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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