Correlation Between Twitter and Omnicom
Can any of the company-specific risk be diversified away by investing in both Twitter and Omnicom 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 Omnicom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Twitter and Omnicom Group, you can compare the effects of market volatilities on Twitter and Omnicom 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 Omnicom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Twitter and Omnicom.
Diversification Opportunities for Twitter and Omnicom
Very weak diversification
The 3 months correlation between Twitter and Omnicom is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Twitter and Omnicom Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omnicom Group 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 Omnicom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omnicom Group has no effect on the direction of Twitter i.e., Twitter and Omnicom go up and down completely randomly.
Pair Corralation between Twitter and Omnicom
If you would invest 9,020 in Omnicom Group on January 26, 2024 and sell it today you would earn a total of 578.00 from holding Omnicom Group or generate 6.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 1.61% |
| Values | Daily Returns |
Twitter vs. Omnicom Group
Performance |
| Timeline |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Omnicom Group |
Twitter and Omnicom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Twitter and Omnicom
The main advantage of trading using opposite Twitter and Omnicom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Twitter position performs unexpectedly, Omnicom 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 Omnicom will offset losses from the drop in Omnicom's long position.| Twitter vs. Carters | Twitter vs. Barrick Gold Corp | Twitter vs. Zoom Video Communications | Twitter vs. Shoe Carnival |
| Omnicom vs. MGO Global Common | Omnicom vs. Baosheng Media Group | Omnicom vs. Glory Star New | Omnicom vs. Impact Fusion International |
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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
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