Correlation Between Genius Sports and Rumble

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

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

Diversification Opportunities for Genius Sports and Rumble

-0.44

Correlation Coefficient

Genius Sports  Rumble

Very good diversification

The 3 months correlation between Genius and Rumble is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Genius Sports and Rumble Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rumble Inc and Genius Sports 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 Genius Sports are associated (or correlated) with Rumble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rumble Inc has no effect on the direction of Genius Sports i.e., Genius Sports and Rumble go up and down completely randomly.

Pair Corralation between Genius Sports and Rumble

Given the investment horizon of 90 days Genius Sports is expected to generate 0.74 times more return on investment than Rumble. However, Genius Sports is 1.34 times less risky than Rumble. It trades about 0.06 of its potential returns per unit of risk. Rumble Inc is currently generating about -0.09 per unit of risk. If you would invest  855.00  in Genius Sports on January 11, 2025 and sell it today you would earn a total of  94.00  from holding Genius Sports or generate 10.99% return on investment over 90 days.

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

Genius Sports  vs.  Rumble Inc

Genius Sports

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Genius Sports are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Genius Sports demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Rumble Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rumble Inc 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 basic indicators remain very healthy which may send shares a bit higher in May 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Genius Sports and Rumble

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

The idea behind Genius Sports and Rumble 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.