Correlation Between Roku and CuriosityStream
Can any of the company-specific risk be diversified away by investing in both Roku and CuriosityStream 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 CuriosityStream into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roku Inc and CuriosityStream, you can compare the effects of market volatilities on Roku and CuriosityStream 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 CuriosityStream. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roku and CuriosityStream.
Diversification Opportunities for Roku and CuriosityStream
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Roku and CuriosityStream is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Roku Inc and CuriosityStream in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CuriosityStream 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 CuriosityStream. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CuriosityStream has no effect on the direction of Roku i.e., Roku and CuriosityStream go up and down completely randomly.
Pair Corralation between Roku and CuriosityStream
Given the investment horizon of 90 days Roku Inc is expected to under-perform the CuriosityStream. But the stock apears to be less risky and, when comparing its historical volatility, Roku Inc is 4.74 times less risky than CuriosityStream. The stock trades about -0.08 of its potential returns per unit of risk. The CuriosityStream is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3.95 in CuriosityStream on August 30, 2024 and sell it today you would lose (0.60) from holding CuriosityStream or give up 15.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Roku Inc vs. CuriosityStream
Performance |
| Timeline |
| Roku Inc |
| CuriosityStream |
Roku and CuriosityStream Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roku and CuriosityStream
The main advantage of trading using opposite Roku and CuriosityStream positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roku position performs unexpectedly, CuriosityStream 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 CuriosityStream will offset losses from the drop in CuriosityStream's long position.| Roku vs. Walt Disney | Roku vs. AMC Entertainment Holdings | Roku vs. Paramount Global Class | Roku vs. Warner Bros Discovery |
| CuriosityStream vs. News Corp B | CuriosityStream vs. News Corp A | CuriosityStream vs. Live Nation Entertainment | CuriosityStream vs. Paramount Global Class |
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 CEOs Directory module to screen CEOs from public companies around the world.
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