Correlation Between Twitter and Legg Mason

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Twitter and Legg Mason 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 Twitter and Legg Mason into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Twitter and Legg Mason Bw, you can compare the effects of market volatilities on Twitter and Legg Mason 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 Twitter with a short position of Legg Mason. Check out your portfolio center. Please also check ongoing floating volatility patterns of Twitter and Legg Mason.

Diversification Opportunities for Twitter and Legg Mason

-0.31
  Correlation Coefficient

Very good diversification

The 3 months correlation between Twitter and Legg is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Twitter and LEGG MASON BW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legg Mason Bw and Twitter 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 Twitter are associated (or correlated) with Legg Mason. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legg Mason Bw has no effect on the direction of Twitter i.e., Twitter and Legg Mason go up and down completely randomly.

Pair Corralation between Twitter and Legg Mason

If you would invest  857.00  in Legg Mason Bw on December 29, 2023 and sell it today you would earn a total of  5.00  from holding Legg Mason Bw or generate 0.58% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy4.55%
ValuesDaily Returns

Twitter  vs.  LEGG MASON BW

 Performance 
       Timeline  
Twitter 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Twitter has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Twitter is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.
Legg Mason Bw 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Legg Mason Bw has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Legg Mason is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Twitter and Legg Mason Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Twitter and Legg Mason

The main advantage of trading using opposite Twitter and Legg Mason positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Twitter position performs unexpectedly, Legg Mason 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 Legg Mason will offset losses from the drop in Legg Mason's long position.
The idea behind Twitter and Legg Mason Bw 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 Transaction History module to view history of all your transactions and understand their impact on performance.

Other Complementary Tools

Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
CEOs Directory
Screen CEOs from public companies around the world
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments