Correlation Between Meta Platforms and Stallion Discoveries

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

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

Diversification Opportunities for Meta Platforms and Stallion Discoveries

0.02

Correlation Coefficient

Meta Platforms  Stallion Discoveries

Significant diversification

The 3 months correlation between Meta and Stallion is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Meta Platforms and Stallion Discoveries Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stallion Discoveries Corp and Meta Platforms 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 Meta Platforms are associated (or correlated) with Stallion Discoveries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stallion Discoveries Corp has no effect on the direction of Meta Platforms i.e., Meta Platforms and Stallion Discoveries go up and down completely randomly.

Pair Corralation between Meta Platforms and Stallion Discoveries

Given the investment horizon of 90 days Meta Platforms is expected to under-perform the Stallion Discoveries. But the stock apears to be less risky and, when comparing its historical volatility, Meta Platforms is 2.48 times less risky than Stallion Discoveries. The stock trades about -0.08 of its potential returns per unit of risk. The Stallion Discoveries Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  24.00  in Stallion Discoveries Corp on September 2, 2025 and sell it today you would earn a total of  4.00  from holding Stallion Discoveries Corp or generate 16.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Meta Platforms  vs.  Stallion Discoveries Corp

Meta Platforms

Risk-Adjusted Performance

Weakest

Over the last 90 days Meta Platforms has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Stallion Discoveries Corp

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Stallion Discoveries Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Stallion Discoveries reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Meta Platforms and Stallion Discoveries

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

The idea behind Meta Platforms and Stallion Discoveries Corp 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.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.