Correlation Between Match and Getty Images
Can any of the company-specific risk be diversified away by investing in both Match and Getty Images 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 Match and Getty Images into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Match Group and Getty Images Holdings, you can compare the effects of market volatilities on Match and Getty Images 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 Match with a short position of Getty Images. Check out your portfolio center. Please also check ongoing floating volatility patterns of Match and Getty Images.
Diversification Opportunities for Match and Getty Images
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Match and Getty is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Match Group and Getty Images Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images Holdings and Match 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 Match Group are associated (or correlated) with Getty Images. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images Holdings has no effect on the direction of Match i.e., Match and Getty Images go up and down completely randomly.
Pair Corralation between Match and Getty Images
Given the investment horizon of 90 days Match Group is expected to under-perform the Getty Images. But the stock apears to be less risky and, when comparing its historical volatility, Match Group is 1.73 times less risky than Getty Images. The stock trades about -0.01 of its potential returns per unit of risk. The Getty Images Holdings is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 527.00 in Getty Images Holdings on August 30, 2024 and sell it today you would lose (234.00) from holding Getty Images Holdings or give up 44.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Match Group vs. Getty Images Holdings
Performance |
| Timeline |
| Match Group |
| Getty Images Holdings |
Match and Getty Images Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Match and Getty Images
The main advantage of trading using opposite Match and Getty Images positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Match position performs unexpectedly, Getty Images 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 Getty Images will offset losses from the drop in Getty Images' long position.The idea behind Match Group and Getty Images Holdings 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.| Getty Images vs. Twilio Inc | Getty Images vs. Baidu Inc | Getty Images vs. Snap Inc | Getty Images vs. ANGI Homeservices |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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