Correlation Between Weibo Corp and Trump Media
Can any of the company-specific risk be diversified away by investing in both Weibo Corp and Trump 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 Weibo Corp and Trump Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weibo Corp and Trump Media Technology, you can compare the effects of market volatilities on Weibo Corp and Trump 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 Weibo Corp with a short position of Trump Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weibo Corp and Trump Media.
Diversification Opportunities for Weibo Corp and Trump Media
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Weibo and Trump is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Weibo Corp and Trump Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trump Media Technology and Weibo Corp 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 Weibo Corp are associated (or correlated) with Trump Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trump Media Technology has no effect on the direction of Weibo Corp i.e., Weibo Corp and Trump Media go up and down completely randomly.
Pair Corralation between Weibo Corp and Trump Media
Allowing for the 90-day total investment horizon Weibo Corp is expected to generate 0.27 times more return on investment than Trump Media. However, Weibo Corp is 3.69 times less risky than Trump Media. It trades about -0.1 of its potential returns per unit of risk. Trump Media Technology is currently generating about -0.13 per unit of risk. If you would invest 959.00 in Weibo Corp on August 27, 2024 and sell it today you would lose (67.00) from holding Weibo Corp or give up 6.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weibo Corp vs. Trump Media Technology
Performance |
| Timeline |
| Weibo Corp |
| Trump Media Technology |
Weibo Corp and Trump Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weibo Corp and Trump Media
The main advantage of trading using opposite Weibo Corp and Trump Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weibo Corp position performs unexpectedly, Trump 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 Trump Media will offset losses from the drop in Trump Media's long position.| Weibo Corp vs. YY Inc Class | Weibo Corp vs. DouYu International Holdings | Weibo Corp vs. Tencent Music Entertainment | Weibo Corp vs. Autohome |
| Trump Media vs. Texas Roadhouse | Trump Media vs. Weibo Corp | Trump Media vs. The Wendys Co | Trump Media vs. Bt Brands |
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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