Correlation Between Trump Media and YY
Can any of the company-specific risk be diversified away by investing in both Trump Media and YY 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 Trump Media and YY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trump Media Technology and YY Inc Class, you can compare the effects of market volatilities on Trump Media and YY 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 Trump Media with a short position of YY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trump Media and YY.
Diversification Opportunities for Trump Media and YY
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trump and YY is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Trump Media Technology and YY Inc Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YY Inc Class and Trump 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 Trump Media Technology are associated (or correlated) with YY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YY Inc Class has no effect on the direction of Trump Media i.e., Trump Media and YY go up and down completely randomly.
Pair Corralation between Trump Media and YY
Considering the 90-day investment horizon Trump Media Technology is expected to generate 3.14 times more return on investment than YY. However, Trump Media is 3.14 times more volatile than YY Inc Class. It trades about 0.04 of its potential returns per unit of risk. YY Inc Class is currently generating about 0.03 per unit of risk. If you would invest 2,166 in Trump Media Technology on August 30, 2024 and sell it today you would earn a total of 878.00 from holding Trump Media Technology or generate 40.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trump Media Technology vs. YY Inc Class
Performance |
| Timeline |
| Trump Media Technology |
| YY Inc Class |
Trump Media and YY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trump Media and YY
The main advantage of trading using opposite Trump Media and YY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trump Media position performs unexpectedly, YY 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 YY will offset losses from the drop in YY's long position.| Trump Media vs. Shake Shack | Trump Media vs. CAVA Group, | Trump Media vs. Bt Brands | Trump Media vs. The Wendys Co |
| YY vs. Weibo Corp | YY vs. DouYu International Holdings | YY vs. Tencent Music Entertainment | YY vs. Autohome |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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