Correlation Between LiveOne and ZoomerMedia

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

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

Diversification Opportunities for LiveOne and ZoomerMedia

0.16

Correlation Coefficient

LiveOne  ZoomerMedia

Average diversification

The 3 months correlation between LiveOne and ZoomerMedia is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding LiveOne and ZoomerMedia Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZoomerMedia Limited and LiveOne 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 LiveOne are associated (or correlated) with ZoomerMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZoomerMedia Limited has no effect on the direction of LiveOne i.e., LiveOne and ZoomerMedia go up and down completely randomly.

Pair Corralation between LiveOne and ZoomerMedia

Considering the 90-day investment horizon LiveOne is expected to under-perform the ZoomerMedia. But the stock apears to be less risky and, when comparing its historical volatility, LiveOne is 16.83 times less risky than ZoomerMedia. The stock trades about -0.02 of its potential returns per unit of risk. The ZoomerMedia Limited is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  0.30  in ZoomerMedia Limited on September 12, 2024 and sell it today you would earn a total of  4.70  from holding ZoomerMedia Limited or generate 1566.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

LiveOne  vs.  ZoomerMedia Limited

LiveOne

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LiveOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

ZoomerMedia Limited

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ZoomerMedia Limited are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, ZoomerMedia reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LiveOne and ZoomerMedia

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

The idea behind LiveOne and ZoomerMedia Limited 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..