Correlation Between Cheer Holding and Cardlytics

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

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

Diversification Opportunities for Cheer Holding and Cardlytics

0.91

Correlation Coefficient

Cheer Holding  Cardlytics

Almost no diversification

The 3 months correlation between Cheer and Cardlytics is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Cheer Holding and Cardlytics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardlytics and Cheer Holding 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 Cheer Holding are associated (or correlated) with Cardlytics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardlytics has no effect on the direction of Cheer Holding i.e., Cheer Holding and Cardlytics go up and down completely randomly.

Pair Corralation between Cheer Holding and Cardlytics

Considering the 90-day investment horizon Cheer Holding is expected to generate about the same return on investment as Cardlytics. But, Cheer Holding is 1.24 times less risky than Cardlytics. It trades about 0.05 of its potential returns per unit of risk. Cardlytics is currently generating about 0.04 per unit of risk. If you would invest  185.00  in Cardlytics on February 26, 2025 and sell it today you would earn a total of  2.00  from holding Cardlytics or generate 1.08% return on investment over 90 days.

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

Cheer Holding  vs.  Cardlytics

Cheer Holding

Risk-Adjusted Performance

Very Weak

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

Cardlytics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cardlytics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's essential indicators remain fairly strong which may send shares a bit higher in June 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Cheer Holding and Cardlytics

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

The idea behind Cheer Holding and Cardlytics 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.