Correlation Between Trump Media and Cheche Group
Can any of the company-specific risk be diversified away by investing in both Trump Media and Cheche Group 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 Cheche Group 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 Cheche Group Warrant, you can compare the effects of market volatilities on Trump Media and Cheche Group 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 Cheche Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trump Media and Cheche Group.
Diversification Opportunities for Trump Media and Cheche Group
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Trump and Cheche is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Trump Media Technology and Cheche Group Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheche Group Warrant 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 Cheche Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheche Group Warrant has no effect on the direction of Trump Media i.e., Trump Media and Cheche Group go up and down completely randomly.
Pair Corralation between Trump Media and Cheche Group
Assuming the 90 days horizon Trump Media Technology is expected to generate 0.33 times more return on investment than Cheche Group. However, Trump Media Technology is 3.06 times less risky than Cheche Group. It trades about 0.08 of its potential returns per unit of risk. Cheche Group Warrant is currently generating about -0.01 per unit of risk. If you would invest 1,962 in Trump Media Technology on November 29, 2024 and sell it today you would earn a total of 99.00 from holding Trump Media Technology or generate 5.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trump Media Technology vs. Cheche Group Warrant
Performance |
| Timeline |
| Trump Media Technology |
| Cheche Group Warrant |
Trump Media and Cheche Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trump Media and Cheche Group
The main advantage of trading using opposite Trump Media and Cheche Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trump Media position performs unexpectedly, Cheche Group 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 Cheche Group will offset losses from the drop in Cheche Group's long position.| Trump Media vs. FARO Technologies | Trump Media vs. Asure Software | Trump Media vs. Scholastic | Trump Media vs. Lincoln Educational Services |
| Cheche Group vs. Coupang LLC | Cheche Group vs. Constellation Brands Class | Cheche Group vs. Fomento Economico Mexicano | Cheche Group vs. Lululemon Athletica |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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