Correlation Between Integral and Marchex

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

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

Diversification Opportunities for Integral and Marchex

0.94

Correlation Coefficient

Integral  Marchex

Almost no diversification

The 3 months correlation between Integral and Marchex is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Marchex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marchex and Integral 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 Integral Ad Science are associated (or correlated) with Marchex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marchex has no effect on the direction of Integral i.e., Integral and Marchex go up and down completely randomly.

Pair Corralation between Integral and Marchex

Considering the 90-day investment horizon Integral Ad Science is expected to under-perform the Marchex. In addition to that, Integral is 1.11 times more volatile than Marchex. It trades about -0.2 of its total potential returns per unit of risk. Marchex is currently generating about -0.18 per unit of volatility. If you would invest  197.00  in Marchex on January 19, 2025 and sell it today you would lose (58.00) from holding Marchex or give up 29.44% of portfolio value over 90 days.

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

Integral Ad Science  vs.  Marchex

Integral Ad Science

Risk-Adjusted Performance

Very Weak

Over the last 90 days Integral Ad Science 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 comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Marchex

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Integral and Marchex

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

The idea behind Integral Ad Science and Marchex 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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.