Correlation Between CyberAgent and Snipp Interactive

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

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

Diversification Opportunities for CyberAgent and Snipp Interactive

-0.65

Correlation Coefficient

CyberAgent  Snipp Interactive

Excellent diversification

The 3 months correlation between CyberAgent and Snipp is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding CyberAgent ADR and Snipp Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Snipp Interactive and CyberAgent 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 CyberAgent ADR are associated (or correlated) with Snipp Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Snipp Interactive has no effect on the direction of CyberAgent i.e., CyberAgent and Snipp Interactive go up and down completely randomly.

Pair Corralation between CyberAgent and Snipp Interactive

Assuming the 90 days horizon CyberAgent ADR is expected to under-perform the Snipp Interactive. But the pink sheet apears to be less risky and, when comparing its historical volatility, CyberAgent ADR is 2.46 times less risky than Snipp Interactive. The pink sheet trades about -0.02 of its potential returns per unit of risk. The Snipp Interactive is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  11.00  in Snipp Interactive on October 24, 2024 and sell it today you would lose (4.73) from holding Snipp Interactive or give up 43.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.6%
Values	Daily Returns

CyberAgent ADR  vs.  Snipp Interactive

CyberAgent ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CyberAgent ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Snipp Interactive

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Snipp Interactive are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal basic indicators, Snipp Interactive reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CyberAgent and Snipp Interactive

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

The idea behind CyberAgent ADR and Snipp Interactive 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.