Correlation Between IQIYI and Beasley Broadcast
Can any of the company-specific risk be diversified away by investing in both IQIYI and Beasley Broadcast 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 IQIYI and Beasley Broadcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iQIYI Inc and Beasley Broadcast Group, you can compare the effects of market volatilities on IQIYI and Beasley Broadcast 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 IQIYI with a short position of Beasley Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQIYI and Beasley Broadcast.
Diversification Opportunities for IQIYI and Beasley Broadcast
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IQIYI and Beasley is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding iQIYI Inc and Beasley Broadcast Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beasley Broadcast and IQIYI 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 iQIYI Inc are associated (or correlated) with Beasley Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beasley Broadcast has no effect on the direction of IQIYI i.e., IQIYI and Beasley Broadcast go up and down completely randomly.
Pair Corralation between IQIYI and Beasley Broadcast
Allowing for the 90-day total investment horizon iQIYI Inc is expected to generate 0.89 times more return on investment than Beasley Broadcast. However, iQIYI Inc is 1.12 times less risky than Beasley Broadcast. It trades about -0.03 of its potential returns per unit of risk. Beasley Broadcast Group is currently generating about -0.05 per unit of risk. If you would invest 417.00 in iQIYI Inc on November 9, 2024 and sell it today you would lose (184.00) from holding iQIYI Inc or give up 44.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iQIYI Inc vs. Beasley Broadcast Group
Performance |
| Timeline |
| iQIYI Inc |
| Beasley Broadcast |
IQIYI and Beasley Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IQIYI and Beasley Broadcast
The main advantage of trading using opposite IQIYI and Beasley Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IQIYI position performs unexpectedly, Beasley Broadcast 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 Beasley Broadcast will offset losses from the drop in Beasley Broadcast's long position.The idea behind iQIYI Inc and Beasley Broadcast Group 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.| Beasley Broadcast vs. ProSiebenSat1 Media AG | Beasley Broadcast vs. RTL Group SA | Beasley Broadcast vs. Mediaco Holding | Beasley Broadcast vs. iHeartMedia |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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