Correlation Between IClick Interactive and Townsquare Media

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

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

Diversification Opportunities for IClick Interactive and Townsquare Media

0.62

Correlation Coefficient

IClick Interactive  Townsquare Media

Poor diversification

The 3 months correlation between IClick and Townsquare is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding iClick Interactive Asia and Townsquare Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Townsquare Media and IClick Interactive 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 iClick Interactive Asia are associated (or correlated) with Townsquare Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Townsquare Media has no effect on the direction of IClick Interactive i.e., IClick Interactive and Townsquare Media go up and down completely randomly.

Pair Corralation between IClick Interactive and Townsquare Media

Given the investment horizon of 90 days iClick Interactive Asia is expected to generate 2.9 times more return on investment than Townsquare Media. However, IClick Interactive is 2.9 times more volatile than Townsquare Media. It trades about 0.07 of its potential returns per unit of risk. Townsquare Media is currently generating about -0.12 per unit of risk. If you would invest  816.00  in iClick Interactive Asia on December 20, 2024 and sell it today you would earn a total of  108.00  from holding iClick Interactive Asia or generate 13.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	91.67%
Values	Daily Returns

iClick Interactive Asia  vs.  Townsquare Media

iClick Interactive Asia

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in iClick Interactive Asia are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile essential indicators, IClick Interactive disclosed solid returns over the last few months and may actually be approaching a breakup point.

Townsquare Media

Risk-Adjusted Performance

Very Weak

Over the last 90 days Townsquare Media has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with IClick Interactive and Townsquare Media

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

The idea behind iClick Interactive Asia and Townsquare Media 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.