Correlation Between Taboola and Yelp

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

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

Diversification Opportunities for Taboola and Yelp

0.68

Correlation Coefficient

Taboola  Yelp

Poor diversification

The 3 months correlation between Taboola and Yelp is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Taboola Ltd Warrant and Yelp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yelp Inc and Taboola 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 Taboola Ltd Warrant are associated (or correlated) with Yelp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yelp Inc has no effect on the direction of Taboola i.e., Taboola and Yelp go up and down completely randomly.

Pair Corralation between Taboola and Yelp

Assuming the 90 days horizon Taboola Ltd Warrant is expected to under-perform the Yelp. In addition to that, Taboola is 5.98 times more volatile than Yelp Inc. It trades about -0.02 of its total potential returns per unit of risk. Yelp Inc is currently generating about -0.02 per unit of volatility. If you would invest  3,859  in Yelp Inc on December 30, 2024 and sell it today you would lose (138.00) from holding Yelp Inc or give up 3.58% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	96.77%
Values	Daily Returns

Taboola Ltd Warrant  vs.  Yelp Inc

Taboola Warrant

Risk-Adjusted Performance

Very Weak

Over the last 90 days Taboola Ltd Warrant has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Yelp Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yelp Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, Yelp is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Taboola and Yelp

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

The idea behind Taboola Ltd Warrant and Yelp Inc 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 Global Correlations module to find global opportunities by holding instruments from different markets.