Correlation Between Trade Desk and Media
Can any of the company-specific risk be diversified away by investing in both Trade Desk and Media 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 Trade Desk and Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Trade Desk and Media and Games, you can compare the effects of market volatilities on Trade Desk and Media 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 Trade Desk with a short position of Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trade Desk and Media.
Diversification Opportunities for Trade Desk and Media
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Trade and Media is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding The Trade Desk and Media and Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media and Games and Trade Desk 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 The Trade Desk are associated (or correlated) with Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media and Games has no effect on the direction of Trade Desk i.e., Trade Desk and Media go up and down completely randomly.
Pair Corralation between Trade Desk and Media
Assuming the 90 days trading horizon The Trade Desk is expected to generate 0.45 times more return on investment than Media. However, The Trade Desk is 2.24 times less risky than Media. It trades about -0.2 of its potential returns per unit of risk. Media and Games is currently generating about -0.2 per unit of risk. If you would invest 12,574 in The Trade Desk on October 17, 2024 and sell it today you would lose (936.00) from holding The Trade Desk or give up 7.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Trade Desk vs. Media and Games
Performance |
| Timeline |
| Trade Desk |
| Media and Games |
Trade Desk and Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trade Desk and Media
The main advantage of trading using opposite Trade Desk and Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trade Desk position performs unexpectedly, Media 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 Media will offset losses from the drop in Media's long position.| Trade Desk vs. FIREWEED METALS P | Trade Desk vs. SILVER BULLET DATA | Trade Desk vs. Linedata Services SA | Trade Desk vs. Stag Industrial |
| Media vs. VARIOUS EATERIES LS | Media vs. Coffee Holding Co | Media vs. H2O Retailing | Media vs. The Trade Desk |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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