Correlation Between Outbrain and Hello
Can any of the company-specific risk be diversified away by investing in both Outbrain and Hello 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 Outbrain and Hello into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Outbrain and Hello Group, you can compare the effects of market volatilities on Outbrain and Hello 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 Outbrain with a short position of Hello. Check out your portfolio center. Please also check ongoing floating volatility patterns of Outbrain and Hello.
Diversification Opportunities for Outbrain and Hello
Very good diversification
The 3 months correlation between Outbrain and Hello is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Outbrain and Hello Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hello Group and Outbrain 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 Outbrain are associated (or correlated) with Hello. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hello Group has no effect on the direction of Outbrain i.e., Outbrain and Hello go up and down completely randomly.
Pair Corralation between Outbrain and Hello
Allowing for the 90-day total investment horizon Outbrain is expected to generate 1.19 times less return on investment than Hello. But when comparing it to its historical volatility, Outbrain is 1.09 times less risky than Hello. It trades about 0.07 of its potential returns per unit of risk. Hello Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 542.00 in Hello Group on September 1, 2024 and sell it today you would earn a total of 131.00 from holding Hello Group or generate 24.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Outbrain vs. Hello Group
Performance |
| Timeline |
| Outbrain |
| Hello Group |
Outbrain and Hello Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Outbrain and Hello
The main advantage of trading using opposite Outbrain and Hello positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Outbrain position performs unexpectedly, Hello 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 Hello will offset losses from the drop in Hello's long position.| Outbrain vs. Perion Network | Outbrain vs. Taboola Ltd Warrant | Outbrain vs. Fiverr International | Outbrain vs. ANGI Homeservices |
| Hello vs. Weibo Corp | Hello vs. Autohome | Hello vs. Tencent Music Entertainment | Hello vs. DouYu International Holdings |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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