Correlation Between Genius Sports and Baidu
Can any of the company-specific risk be diversified away by investing in both Genius Sports and Baidu 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 Genius Sports and Baidu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genius Sports and Baidu Inc, you can compare the effects of market volatilities on Genius Sports and Baidu 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 Genius Sports with a short position of Baidu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genius Sports and Baidu.
Diversification Opportunities for Genius Sports and Baidu
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Genius and Baidu is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Genius Sports and Baidu Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baidu Inc and Genius Sports 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 Genius Sports are associated (or correlated) with Baidu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baidu Inc has no effect on the direction of Genius Sports i.e., Genius Sports and Baidu go up and down completely randomly.
Pair Corralation between Genius Sports and Baidu
Given the investment horizon of 90 days Genius Sports is expected to generate 2.39 times less return on investment than Baidu. But when comparing it to its historical volatility, Genius Sports is 1.05 times less risky than Baidu. It trades about 0.07 of its potential returns per unit of risk. Baidu Inc is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 8,134 in Baidu Inc on November 9, 2024 and sell it today you would earn a total of 747.00 from holding Baidu Inc or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genius Sports vs. Baidu Inc
Performance |
| Timeline |
| Genius Sports |
| Baidu Inc |
Genius Sports and Baidu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genius Sports and Baidu
The main advantage of trading using opposite Genius Sports and Baidu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genius Sports position performs unexpectedly, Baidu 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 Baidu will offset losses from the drop in Baidu's long position.| Genius Sports vs. MediaAlpha | Genius Sports vs. Comscore | Genius Sports vs. Cheetah Mobile | Genius Sports vs. Onfolio Holdings |
| Baidu vs. Tencent Music Entertainment | Baidu vs. Twilio Inc | Baidu vs. Spotify Technology SA | Baidu vs. Weibo Corp |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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