Correlation Between Netflix and Genius Brands
Can any of the company-specific risk be diversified away by investing in both Netflix and Genius Brands 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 Netflix and Genius Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Genius Brands International, you can compare the effects of market volatilities on Netflix and Genius Brands 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 Netflix with a short position of Genius Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Genius Brands.
Diversification Opportunities for Netflix and Genius Brands
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Netflix and Genius is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Genius Brands International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genius Brands Intern and Netflix 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 Netflix are associated (or correlated) with Genius Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genius Brands Intern has no effect on the direction of Netflix i.e., Netflix and Genius Brands go up and down completely randomly.
Pair Corralation between Netflix and Genius Brands
If you would invest 75,944 in Netflix on August 30, 2024 and sell it today you would earn a total of 11,790 from holding Netflix or generate 15.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Netflix vs. Genius Brands International
Performance |
| Timeline |
| Netflix |
| Genius Brands Intern |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Netflix and Genius Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Genius Brands
The main advantage of trading using opposite Netflix and Genius Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Genius Brands 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 Genius Brands will offset losses from the drop in Genius Brands' long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
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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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