Correlation Between Baidu and Thryv Holdings

Can any of the company-specific risk be diversified away by investing in both Baidu and Thryv Holdings 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 Baidu and Thryv Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Baidu Inc and Thryv Holdings, you can compare the effects of market volatilities on Baidu and Thryv Holdings 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 Baidu with a short position of Thryv Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baidu and Thryv Holdings.

Diversification Opportunities for Baidu and Thryv Holdings

-0.22

Correlation Coefficient

Baidu  Thryv Holdings

Very good diversification

The 3 months correlation between Baidu and Thryv is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Baidu Inc and Thryv Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thryv Holdings and Baidu 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 Baidu Inc are associated (or correlated) with Thryv Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thryv Holdings has no effect on the direction of Baidu i.e., Baidu and Thryv Holdings go up and down completely randomly.

Pair Corralation between Baidu and Thryv Holdings

Assuming the 90 days horizon Baidu Inc is expected to generate 2.38 times more return on investment than Thryv Holdings. However, Baidu is 2.38 times more volatile than Thryv Holdings. It trades about 0.04 of its potential returns per unit of risk. Thryv Holdings is currently generating about 0.02 per unit of risk. If you would invest  1,218  in Baidu Inc on December 28, 2024 and sell it today you would earn a total of  27.00  from holding Baidu Inc or generate 2.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Baidu Inc  vs.  Thryv Holdings

Baidu Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Baidu Inc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, Baidu reported solid returns over the last few months and may actually be approaching a breakup point.

Thryv Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thryv Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Thryv Holdings is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Baidu and Thryv Holdings

The main advantage of trading using opposite Baidu and Thryv Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baidu position performs unexpectedly, Thryv Holdings 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 Thryv Holdings will offset losses from the drop in Thryv Holdings' long position.

The idea behind Baidu Inc and Thryv Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.