Correlation Between Roku and Genius Brands
Can any of the company-specific risk be diversified away by investing in both Roku 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 Roku and Genius Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roku Inc and Genius Brands International, you can compare the effects of market volatilities on Roku 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 Roku with a short position of Genius Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roku and Genius Brands.
Diversification Opportunities for Roku and Genius Brands
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Roku and Genius is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Roku Inc 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 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 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 Roku i.e., Roku and Genius Brands go up and down completely randomly.
Pair Corralation between Roku and Genius Brands
Given the investment horizon of 90 days Roku Inc is expected to generate 0.75 times more return on investment than Genius Brands. However, Roku Inc is 1.33 times less risky than Genius Brands. It trades about 0.03 of its potential returns per unit of risk. Genius Brands International is currently generating about -0.07 per unit of risk. If you would invest 5,174 in Roku Inc on August 30, 2024 and sell it today you would earn a total of 1,597 from holding Roku Inc or generate 30.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 27.27% |
| Values | Daily Returns |
Roku Inc vs. Genius Brands International
Performance |
| Timeline |
| Roku Inc |
| Genius Brands Intern |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Roku and Genius Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roku and Genius Brands
The main advantage of trading using opposite Roku and Genius Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roku 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.| Roku vs. Walt Disney | Roku vs. AMC Entertainment Holdings | Roku vs. Paramount Global Class | Roku vs. Warner Bros Discovery |
| Genius Brands vs. Cineverse Corp | Genius Brands vs. LiveOne | Genius Brands vs. Hall of Fame | Genius Brands vs. Netflix |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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