Correlation Between Pandora Media and Inteliquent

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

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

Diversification Opportunities for Pandora Media and Inteliquent

0.0

Correlation Coefficient

Pandora Media  Inteliquent

Pay attention - limited upside

The 3 months correlation between Pandora and Inteliquent is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Pandora Media and Inteliquent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inteliquent and Pandora Media 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 Pandora Media are associated (or correlated) with Inteliquent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inteliquent has no effect on the direction of Pandora Media i.e., Pandora Media and Inteliquent go up and down completely randomly.

Pair Corralation between Pandora Media and Inteliquent

If you would invest (100.00) in Inteliquent on February 5, 2024 and sell it today you would earn a total of  100.00  from holding Inteliquent or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Pandora Media  vs.  Inteliquent

Pandora Media

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pandora Media has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Pandora Media is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Inteliquent

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inteliquent has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Inteliquent is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Pandora Media and Inteliquent

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

The idea behind Pandora Media and Inteliquent 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.