Correlation Between Integral and Cardlytics

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

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

Diversification Opportunities for Integral and Cardlytics

0.58

Correlation Coefficient

Integral  Cardlytics

Very weak diversification

The 3 months correlation between Integral and Cardlytics is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Cardlytics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardlytics and Integral 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 Integral Ad Science are associated (or correlated) with Cardlytics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardlytics has no effect on the direction of Integral i.e., Integral and Cardlytics go up and down completely randomly.

Pair Corralation between Integral and Cardlytics

Considering the 90-day investment horizon Integral Ad Science is expected to generate 0.39 times more return on investment than Cardlytics. However, Integral Ad Science is 2.53 times less risky than Cardlytics. It trades about -0.09 of its potential returns per unit of risk. Cardlytics is currently generating about -0.11 per unit of risk. If you would invest  1,036  in Integral Ad Science on December 24, 2024 and sell it today you would lose (131.00) from holding Integral Ad Science or give up 12.64% of portfolio value over 90 days.

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

Integral Ad Science  vs.  Cardlytics

Integral Ad Science

Risk-Adjusted Performance

Very Weak

Over the last 90 days Integral Ad Science has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Cardlytics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cardlytics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's essential indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Integral and Cardlytics

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

The idea behind Integral Ad Science and Cardlytics 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.