Correlation Between VS Media and FingerMotion

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

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

Diversification Opportunities for VS Media and FingerMotion

-0.47

Correlation Coefficient

VS Media  FingerMotion

Very good diversification

The 3 months correlation between VSME and FingerMotion is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding VS Media Holdings and FingerMotion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FingerMotion and VS 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 VS Media Holdings are associated (or correlated) with FingerMotion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FingerMotion has no effect on the direction of VS Media i.e., VS Media and FingerMotion go up and down completely randomly.

Pair Corralation between VS Media and FingerMotion

Given the investment horizon of 90 days VS Media Holdings is expected to generate 4.84 times more return on investment than FingerMotion. However, VS Media is 4.84 times more volatile than FingerMotion. It trades about 0.08 of its potential returns per unit of risk. FingerMotion is currently generating about -0.04 per unit of risk. If you would invest  95.00  in VS Media Holdings on August 29, 2024 and sell it today you would earn a total of  17.00  from holding VS Media Holdings or generate 17.89% return on investment over 90 days.

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

VS Media Holdings  vs.  FingerMotion

VS Media Holdings

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in VS Media Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting primary indicators, VS Media exhibited solid returns over the last few months and may actually be approaching a breakup point.

FingerMotion

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FingerMotion has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with VS Media and FingerMotion

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

The idea behind VS Media Holdings and FingerMotion 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.