Correlation Between Roku and Comcast
Can any of the company-specific risk be diversified away by investing in both Roku and Comcast 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 Roku and Comcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roku Inc and Comcast, you can compare the effects of market volatilities on Roku and Comcast 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 Roku with a short position of Comcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roku and Comcast.
Diversification Opportunities for Roku and Comcast
Weak diversification
The 3 months correlation between Roku and Comcast is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Roku Inc and Comcast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comcast and Roku 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 Roku Inc are associated (or correlated) with Comcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comcast has no effect on the direction of Roku i.e., Roku and Comcast go up and down completely randomly.
Pair Corralation between Roku and Comcast
Assuming the 90 days trading horizon Roku Inc is expected to generate 1.66 times more return on investment than Comcast. However, Roku is 1.66 times more volatile than Comcast. It trades about 0.24 of its potential returns per unit of risk. Comcast is currently generating about -0.12 per unit of risk. If you would invest 2,116 in Roku Inc on September 12, 2024 and sell it today you would earn a total of 425.00 from holding Roku Inc or generate 20.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Roku Inc vs. Comcast
Performance |
| Timeline |
| Roku Inc |
| Comcast |
Roku and Comcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roku and Comcast
The main advantage of trading using opposite Roku and Comcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roku position performs unexpectedly, Comcast 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 Comcast will offset losses from the drop in Comcast's long position.| Roku vs. Sumitomo Mitsui Financial | Roku vs. G2D Investments | Roku vs. Bemobi Mobile Tech | Roku vs. Ameriprise Financial |
| Comcast vs. Verizon Communications | Comcast vs. Take Two Interactive Software | Comcast vs. BIONTECH SE DRN | Comcast vs. MAHLE Metal Leve |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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