Correlation Between Integral and Weibo Corp

Can any of the company-specific risk be diversified away by investing in both Integral and Weibo Corp 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 Weibo Corp 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 Weibo Corp, you can compare the effects of market volatilities on Integral and Weibo Corp 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 Weibo Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integral and Weibo Corp.

Diversification Opportunities for Integral and Weibo Corp

-0.01

Correlation Coefficient

Integral  Weibo Corp

Good diversification

The 3 months correlation between Integral and Weibo is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Weibo Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weibo Corp 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 Weibo Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weibo Corp has no effect on the direction of Integral i.e., Integral and Weibo Corp go up and down completely randomly.

Pair Corralation between Integral and Weibo Corp

Considering the 90-day investment horizon Integral Ad Science is expected to under-perform the Weibo Corp. But the stock apears to be less risky and, when comparing its historical volatility, Integral Ad Science is 1.19 times less risky than Weibo Corp. The stock trades about -0.12 of its potential returns per unit of risk. The Weibo Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  954.00  in Weibo Corp on December 28, 2024 and sell it today you would earn a total of  47.00  from holding Weibo Corp or generate 4.93% return on investment over 90 days.

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

Integral Ad Science  vs.  Weibo Corp

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 weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Weibo Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Weibo Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, Weibo Corp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Integral and Weibo Corp

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

The idea behind Integral Ad Science and Weibo Corp 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.