Correlation Between Baosheng Media and Thumzup Media
Can any of the company-specific risk be diversified away by investing in both Baosheng Media and Thumzup 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 Baosheng Media and Thumzup Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baosheng Media Group and Thumzup Media, you can compare the effects of market volatilities on Baosheng Media and Thumzup 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 Baosheng Media with a short position of Thumzup Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baosheng Media and Thumzup Media.
Diversification Opportunities for Baosheng Media and Thumzup Media
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Baosheng and Thumzup is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Baosheng Media Group and Thumzup Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thumzup Media and Baosheng 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 Baosheng Media Group are associated (or correlated) with Thumzup Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thumzup Media has no effect on the direction of Baosheng Media i.e., Baosheng Media and Thumzup Media go up and down completely randomly.
Pair Corralation between Baosheng Media and Thumzup Media
Given the investment horizon of 90 days Baosheng Media Group is expected to generate 0.57 times more return on investment than Thumzup Media. However, Baosheng Media Group is 1.74 times less risky than Thumzup Media. It trades about 0.01 of its potential returns per unit of risk. Thumzup Media is currently generating about -0.18 per unit of risk. If you would invest 201.00 in Baosheng Media Group on August 24, 2024 and sell it today you would lose (4.00) from holding Baosheng Media Group or give up 1.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baosheng Media Group vs. Thumzup Media
Performance |
| Timeline |
| Baosheng Media Group |
| Thumzup Media |
Baosheng Media and Thumzup Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baosheng Media and Thumzup Media
The main advantage of trading using opposite Baosheng Media and Thumzup Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baosheng Media position performs unexpectedly, Thumzup 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 Thumzup Media will offset losses from the drop in Thumzup Media's long position.The idea behind Baosheng Media Group and Thumzup Media 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.| Thumzup Media vs. WiMi Hologram Cloud | Thumzup Media vs. National CineMedia | Thumzup Media vs. Baosheng Media Group |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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