Correlation Analysis Between Twitter and Facebook

This module allows you to analyze existing cross correlation between Twitter and Facebook. You can compare the effects of market volatilities on Twitter and Facebook 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 Facebook. See also your portfolio center. Please also check ongoing floating volatility patterns of Twitter and Facebook.
Horizon     30 Days    Login   to change
Symbolsvs
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Comparative Performance

Twitter  
88

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Twitter are ranked lower than 8 (%) of all global equities and portfolios over the last 30 days. In defiance of relatively weak forward-looking signals, Twitter reported solid returns over the last few months and may actually be approaching a breakup point.
Facebook  
00

Risk-Adjusted Performance

Over the last 30 days Facebook has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Facebook is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short term losses for the investors.

Twitter and Facebook Volatility Contrast

 Predicted Return Density 
      Returns 

Twitter Inc  vs.  Facebook Inc

 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, Twitter is expected to generate 1.5 times more return on investment than Facebook. However, Twitter is 1.5 times more volatile than Facebook. It trades about 0.12 of its potential returns per unit of risk. Facebook is currently generating about -0.01 per unit of risk. If you would invest  3,665  in Twitter on August 17, 2019 and sell it today you would earn a total of  611.00  from holding Twitter or generate 16.67% return on investment over 30 days.

Pair Corralation between Twitter and Facebook

0.04
Time Period3 Months [change]
DirectionPositive 
StrengthInsignificant
Accuracy98.44%
ValuesDaily Returns

Diversification Opportunities for Twitter and Facebook

Twitter Inc diversification synergy

Significant diversification

Overlapping area represents the amount of risk that can be diversified away by holding Twitter Inc and Facebook Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Facebook 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 Facebook. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Facebook has no effect on the direction of Twitter i.e. Twitter and Facebook go up and down completely randomly.
See also your portfolio center. Please also try Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.


 
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