Correlation Between Meta Platforms and Target
Can any of the company-specific risk be diversified away by investing in both Meta Platforms and Target 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 Meta Platforms and Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meta Platforms and Target, you can compare the effects of market volatilities on Meta Platforms and Target 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 Meta Platforms with a short position of Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meta Platforms and Target.
Diversification Opportunities for Meta Platforms and Target
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Meta and Target is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Meta Platforms and Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Target and Meta Platforms 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 Meta Platforms are associated (or correlated) with Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Target has no effect on the direction of Meta Platforms i.e., Meta Platforms and Target go up and down completely randomly.
Pair Corralation between Meta Platforms and Target
If you would invest 15,015 in Target on January 25, 2024 and sell it today you would earn a total of 1,587 from holding Target or generate 10.57% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 2.38% |
Values | Daily Returns |
Meta Platforms vs. Target
Performance |
Timeline |
Meta Platforms |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Target |
Meta Platforms and Target Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Meta Platforms and Target
The main advantage of trading using opposite Meta Platforms and Target positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meta Platforms position performs unexpectedly, Target 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 Target will offset losses from the drop in Target's long position.Meta Platforms vs. Meta Platforms | Meta Platforms vs. Alphabet Inc Class A | Meta Platforms vs. Twilio Inc | Meta Platforms vs. Snap Inc |
Target vs. Costco Wholesale Corp | Target vs. BJs Wholesale Club | Target vs. Dollar Tree | Target vs. Dollar General |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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