Correlation Between Gannett and Friendable

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

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

Diversification Opportunities for Gannett and Friendable

0.2

Correlation Coefficient

Gannett  Friendable

Modest diversification

The 3 months correlation between Gannett and Friendable is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Gannett Co and Friendable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Friendable and Gannett 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 Gannett Co are associated (or correlated) with Friendable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Friendable has no effect on the direction of Gannett i.e., Gannett and Friendable go up and down completely randomly.

Pair Corralation between Gannett and Friendable

If you would invest  0.01  in Friendable on October 4, 2024 and sell it today you would earn a total of  0.00  from holding Friendable or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Gannett Co  vs.  Friendable

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.

Friendable

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Friendable are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, Friendable disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gannett and Friendable

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

The idea behind Gannett Co and Friendable 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.