Correlation Between Trump Media and Lizhi

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

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

Diversification Opportunities for Trump Media and Lizhi

-0.76

Correlation Coefficient

Trump Media  Lizhi

Pay attention - limited upside

The 3 months correlation between Trump and Lizhi is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Trump Media Technology and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc and Trump 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 Trump Media Technology are associated (or correlated) with Lizhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lizhi Inc has no effect on the direction of Trump Media i.e., Trump Media and Lizhi go up and down completely randomly.

Pair Corralation between Trump Media and Lizhi

Considering the 90-day investment horizon Trump Media Technology is expected to under-perform the Lizhi. But the stock apears to be less risky and, when comparing its historical volatility, Trump Media Technology is 4.71 times less risky than Lizhi. The stock trades about -0.18 of its potential returns per unit of risk. The Lizhi Inc is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  119.00  in Lizhi Inc on May 7, 2025 and sell it today you would earn a total of  347.00  from holding Lizhi Inc or generate 291.6% return on investment over 90 days.

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

Trump Media Technology  vs.  Lizhi Inc

Trump Media Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Trump Media Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward-looking indicators remain comparatively stable which may send shares a bit higher in September 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Lizhi Inc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lizhi Inc are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile technical and fundamental indicators, Lizhi reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Trump Media and Lizhi

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

The idea behind Trump Media Technology and Lizhi 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.