Correlation Between Roku and Imagination
Can any of the company-specific risk be diversified away by investing in both Roku and Imagination 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 Imagination into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roku Inc and Imagination TV, you can compare the effects of market volatilities on Roku and Imagination 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 Imagination. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roku and Imagination.
Diversification Opportunities for Roku and Imagination
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Roku and Imagination is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Roku Inc and Imagination TV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imagination TV 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 Imagination. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imagination TV has no effect on the direction of Roku i.e., Roku and Imagination go up and down completely randomly.
Pair Corralation between Roku and Imagination
If you would invest 0.01 in Imagination TV on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Imagination TV or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Roku Inc vs. Imagination TV
Performance |
| Timeline |
| Roku Inc |
| Imagination TV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Roku and Imagination Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roku and Imagination
The main advantage of trading using opposite Roku and Imagination positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roku position performs unexpectedly, Imagination 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 Imagination will offset losses from the drop in Imagination's long position.| Roku vs. Walt Disney | Roku vs. AMC Entertainment Holdings | Roku vs. Paramount Global Class | Roku vs. Warner Bros Discovery |
| Imagination vs. Walt Disney | Imagination vs. Roku Inc | Imagination vs. AMC Entertainment Holdings | Imagination 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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