Correlation Between Alibaba Group and Clear Media
Can any of the company-specific risk be diversified away by investing in both Alibaba Group and Clear 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 Alibaba Group and Clear Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alibaba Group Holding and Clear Media Limited, you can compare the effects of market volatilities on Alibaba Group and Clear 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 Alibaba Group with a short position of Clear Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alibaba Group and Clear Media.
Diversification Opportunities for Alibaba Group and Clear Media
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alibaba and Clear is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alibaba Group Holding and Clear Media Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clear Media Limited and Alibaba Group 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 Alibaba Group Holding are associated (or correlated) with Clear Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clear Media Limited has no effect on the direction of Alibaba Group i.e., Alibaba Group and Clear Media go up and down completely randomly.
Pair Corralation between Alibaba Group and Clear Media
If you would invest (100.00) in Clear Media Limited on January 20, 2024 and sell it today you would earn a total of 100.00 from holding Clear Media Limited or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Alibaba Group Holding vs. Clear Media Limited
Performance |
| Timeline |
| Alibaba Group Holding |
| Clear Media Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Alibaba Group and Clear Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alibaba Group and Clear Media
The main advantage of trading using opposite Alibaba Group and Clear Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alibaba Group position performs unexpectedly, Clear 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 Clear Media will offset losses from the drop in Clear Media's long position.| Alibaba Group vs. Shoe Carnival | Alibaba Group vs. Hibbett Sports | Alibaba Group vs. Citi Trends | Alibaba Group vs. Zumiez Inc |
| Clear Media vs. enVVeno Medical Corp | Clear Media vs. Omni Health | Clear Media vs. Ameriprise Financial | Clear Media vs. Waters |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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