Correlation Between Genius Brands and Paramount Global

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

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

Diversification Opportunities for Genius Brands and Paramount Global

0.0

Correlation Coefficient

Genius Brands  Paramount Global

Pay attention - limited upside

The 3 months correlation between Genius and Paramount is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Genius Brands International and Paramount Global Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paramount Global Class and Genius Brands 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 Genius Brands International are associated (or correlated) with Paramount Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paramount Global Class has no effect on the direction of Genius Brands i.e., Genius Brands and Paramount Global go up and down completely randomly.

Pair Corralation between Genius Brands and Paramount Global

If you would invest  1,116  in Paramount Global Class on November 28, 2024 and sell it today you would earn a total of  23.50  from holding Paramount Global Class or generate 2.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Genius Brands International  vs.  Paramount Global Class

Genius Brands Intern

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genius Brands International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Genius Brands is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Paramount Global Class

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Paramount Global Class are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Paramount Global may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Genius Brands and Paramount Global

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

The idea behind Genius Brands International and Paramount Global Class 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.