Correlation Between Leet Technology and Roku

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

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

Diversification Opportunities for Leet Technology and Roku

0.14

Correlation Coefficient

Leet Technology  Roku

Average diversification

The 3 months correlation between Leet and Roku is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Leet Technology and Roku Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roku Inc and Leet Technology 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 Leet Technology are associated (or correlated) with Roku. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roku Inc has no effect on the direction of Leet Technology i.e., Leet Technology and Roku go up and down completely randomly.

Pair Corralation between Leet Technology and Roku

Given the investment horizon of 90 days Leet Technology is expected to under-perform the Roku. But the pink sheet apears to be less risky and, when comparing its historical volatility, Leet Technology is 1.3 times less risky than Roku. The pink sheet trades about -0.05 of its potential returns per unit of risk. The Roku Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  7,469  in Roku Inc on September 13, 2024 and sell it today you would earn a total of  721.00  from holding Roku Inc or generate 9.65% return on investment over 90 days.

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

Leet Technology  vs.  Roku Inc

Leet Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leet Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Roku Inc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Roku Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, Roku unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Leet Technology and Roku

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

The idea behind Leet Technology and Roku 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.