Correlation Between VS Media and IClick Interactive

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

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

Diversification Opportunities for VS Media and IClick Interactive

0.47

Correlation Coefficient

VS Media  IClick Interactive

Very weak diversification

The 3 months correlation between VSME and IClick is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding VS Media Holdings and iClick Interactive Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iClick Interactive Asia and VS Media 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 VS Media Holdings are associated (or correlated) with IClick Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iClick Interactive Asia has no effect on the direction of VS Media i.e., VS Media and IClick Interactive go up and down completely randomly.

Pair Corralation between VS Media and IClick Interactive

Given the investment horizon of 90 days VS Media is expected to generate 3.78 times less return on investment than IClick Interactive. In addition to that, VS Media is 1.14 times more volatile than iClick Interactive Asia. It trades about 0.01 of its total potential returns per unit of risk. iClick Interactive Asia is currently generating about 0.05 per unit of volatility. If you would invest  876.00  in iClick Interactive Asia on December 19, 2024 and sell it today you would earn a total of  48.00  from holding iClick Interactive Asia or generate 5.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.33%
Values	Daily Returns

VS Media Holdings  vs.  iClick Interactive Asia

VS Media Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days VS Media Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, VS Media is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

iClick Interactive Asia

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in iClick Interactive Asia are ranked lower than 3 (%) 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.

Pair Trading with VS Media and IClick Interactive

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

The idea behind VS Media Holdings and iClick Interactive Asia 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.