Correlation Between Cheer Holding and Gannett

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

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

Diversification Opportunities for Cheer Holding and Gannett

0.55

Correlation Coefficient

Cheer Holding  Gannett

Very weak diversification

The 3 months correlation between Cheer and Gannett is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Cheer Holding and Gannett Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gannett and Cheer Holding 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 Cheer Holding are associated (or correlated) with Gannett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gannett has no effect on the direction of Cheer Holding i.e., Cheer Holding and Gannett go up and down completely randomly.

Pair Corralation between Cheer Holding and Gannett

Considering the 90-day investment horizon Cheer Holding is expected to under-perform the Gannett. But the stock apears to be less risky and, when comparing its historical volatility, Cheer Holding is 1.41 times less risky than Gannett. The stock trades about -0.09 of its potential returns per unit of risk. The Gannett Co is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  559.00  in Gannett Co on October 25, 2024 and sell it today you would lose (84.50) from holding Gannett Co or give up 15.12% of portfolio value over 90 days.

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

Cheer Holding  vs.  Gannett Co

Cheer Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cheer Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's technical indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Gannett

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gannett Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Cheer Holding and Gannett

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

The idea behind Cheer Holding and Gannett Co 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.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.