Correlation Between Townsquare Media and Criteo Sa
Can any of the company-specific risk be diversified away by investing in both Townsquare Media and Criteo Sa 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 Townsquare Media and Criteo Sa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Townsquare Media and Criteo Sa, you can compare the effects of market volatilities on Townsquare Media and Criteo Sa 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 Townsquare Media with a short position of Criteo Sa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Townsquare Media and Criteo Sa.
Diversification Opportunities for Townsquare Media and Criteo Sa
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Townsquare and Criteo is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Townsquare Media and Criteo Sa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Criteo Sa and Townsquare Media 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 Townsquare Media are associated (or correlated) with Criteo Sa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Criteo Sa has no effect on the direction of Townsquare Media i.e., Townsquare Media and Criteo Sa go up and down completely randomly.
Pair Corralation between Townsquare Media and Criteo Sa
Considering the 90-day investment horizon Townsquare Media is expected to under-perform the Criteo Sa. But the stock apears to be less risky and, when comparing its historical volatility, Townsquare Media is 3.51 times less risky than Criteo Sa. The stock trades about -0.09 of its potential returns per unit of risk. The Criteo Sa is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4,094 in Criteo Sa on August 27, 2024 and sell it today you would lose (98.00) from holding Criteo Sa or give up 2.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Townsquare Media vs. Criteo Sa
Performance |
| Timeline |
| Townsquare Media |
| Criteo Sa |
Townsquare Media and Criteo Sa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Townsquare Media and Criteo Sa
The main advantage of trading using opposite Townsquare Media and Criteo Sa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Townsquare Media position performs unexpectedly, Criteo Sa 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 Criteo Sa will offset losses from the drop in Criteo Sa's long position.| Townsquare Media vs. Mirriad Advertising plc | Townsquare Media vs. INEO Tech Corp | Townsquare Media vs. Kidoz Inc | Townsquare Media vs. Marchex |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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