Correlation Between CuriosityStream and LiveOne

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

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

Diversification Opportunities for CuriosityStream and LiveOne

-0.46

Correlation Coefficient

CuriosityStream  LiveOne

Very good diversification

The 3 months correlation between CuriosityStream and LiveOne is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding CuriosityStream and LiveOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiveOne and CuriosityStream 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 CuriosityStream are associated (or correlated) with LiveOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiveOne has no effect on the direction of CuriosityStream i.e., CuriosityStream and LiveOne go up and down completely randomly.

Pair Corralation between CuriosityStream and LiveOne

Assuming the 90 days horizon CuriosityStream is expected to generate 27.45 times more return on investment than LiveOne. However, CuriosityStream is 27.45 times more volatile than LiveOne. It trades about 0.16 of its potential returns per unit of risk. LiveOne is currently generating about -0.01 per unit of risk. If you would invest  3.22  in CuriosityStream on October 13, 2024 and sell it today you would lose (0.32) from holding CuriosityStream or give up 9.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	90.21%
Values	Daily Returns

CuriosityStream  vs.  LiveOne

CuriosityStream

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CuriosityStream are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal forward indicators, CuriosityStream showed solid returns over the last few months and may actually be approaching a breakup point.

LiveOne

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in LiveOne are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, LiveOne displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CuriosityStream and LiveOne

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

The idea behind CuriosityStream and LiveOne 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.