Correlation Between MediaAlpha and Snap
Can any of the company-specific risk be diversified away by investing in both MediaAlpha and Snap 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 MediaAlpha and Snap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MediaAlpha and Snap Inc, you can compare the effects of market volatilities on MediaAlpha and Snap 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 MediaAlpha with a short position of Snap. Check out your portfolio center. Please also check ongoing floating volatility patterns of MediaAlpha and Snap.
Diversification Opportunities for MediaAlpha and Snap
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MediaAlpha and Snap is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding MediaAlpha and Snap Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Snap Inc and MediaAlpha 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 MediaAlpha are associated (or correlated) with Snap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Snap Inc has no effect on the direction of MediaAlpha i.e., MediaAlpha and Snap go up and down completely randomly.
Pair Corralation between MediaAlpha and Snap
Considering the 90-day investment horizon MediaAlpha is expected to generate 0.92 times more return on investment than Snap. However, MediaAlpha is 1.09 times less risky than Snap. It trades about 0.04 of its potential returns per unit of risk. Snap Inc is currently generating about 0.01 per unit of risk. If you would invest 1,012 in MediaAlpha on August 26, 2024 and sell it today you would earn a total of 261.00 from holding MediaAlpha or generate 25.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MediaAlpha vs. Snap Inc
Performance |
| Timeline |
| MediaAlpha |
| Snap Inc |
MediaAlpha and Snap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MediaAlpha and Snap
The main advantage of trading using opposite MediaAlpha and Snap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MediaAlpha position performs unexpectedly, Snap 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 Snap will offset losses from the drop in Snap's long position.| MediaAlpha vs. Asset Entities Class | MediaAlpha vs. Yelp Inc | MediaAlpha vs. BuzzFeed | MediaAlpha vs. Vivid Seats |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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