Correlation Between Affirm Holdings and Kuya Silver

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

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

Diversification Opportunities for Affirm Holdings and Kuya Silver

0.15

Correlation Coefficient

Affirm Holdings  Kuya Silver

Average diversification

The 3 months correlation between Affirm and Kuya is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Affirm Holdings and Kuya Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuya Silver and Affirm Holdings 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 Affirm Holdings are associated (or correlated) with Kuya Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuya Silver has no effect on the direction of Affirm Holdings i.e., Affirm Holdings and Kuya Silver go up and down completely randomly.

Pair Corralation between Affirm Holdings and Kuya Silver

Given the investment horizon of 90 days Affirm Holdings is expected to under-perform the Kuya Silver. In addition to that, Affirm Holdings is 1.03 times more volatile than Kuya Silver. It trades about -0.1 of its total potential returns per unit of risk. Kuya Silver is currently generating about 0.12 per unit of volatility. If you would invest  18.00  in Kuya Silver on December 19, 2024 and sell it today you would earn a total of  6.00  from holding Kuya Silver or generate 33.33% return on investment over 90 days.

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

Affirm Holdings  vs.  Kuya Silver

Affirm Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Affirm Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Kuya Silver

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kuya Silver are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Kuya Silver reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Affirm Holdings and Kuya Silver

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

The idea behind Affirm Holdings and Kuya Silver 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.