Correlation Between Perion Network and Comscore

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

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

Diversification Opportunities for Perion Network and Comscore

0.19

Correlation Coefficient

Perion Network  Comscore

Average diversification

The 3 months correlation between Perion and Comscore is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Perion Network and Comscore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comscore and Perion Network 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 Perion Network are associated (or correlated) with Comscore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comscore has no effect on the direction of Perion Network i.e., Perion Network and Comscore go up and down completely randomly.

Pair Corralation between Perion Network and Comscore

Given the investment horizon of 90 days Perion Network is expected to generate 1.28 times less return on investment than Comscore. But when comparing it to its historical volatility, Perion Network is 3.31 times less risky than Comscore. It trades about 0.12 of its potential returns per unit of risk. Comscore is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  676.00  in Comscore on September 13, 2024 and sell it today you would earn a total of  33.00  from holding Comscore or generate 4.88% return on investment over 90 days.

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

Perion Network  vs.  Comscore

Perion Network

Risk-Adjusted Performance

5 of 100

OK

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

Comscore

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Comscore are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Comscore reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Perion Network and Comscore

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

The idea behind Perion Network and Comscore 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.

Check out your portfolio center.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.