Correlation Between C3 Ai and VTEX

Can any of the company-specific risk be diversified away by investing in both C3 Ai and VTEX 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 C3 Ai and VTEX into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between C3 Ai Inc and VTEX, you can compare the effects of market volatilities on C3 Ai and VTEX 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 C3 Ai with a short position of VTEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of C3 Ai and VTEX.

Diversification Opportunities for C3 Ai and VTEX

0.78

Correlation Coefficient

C3 Ai  VTEX

Poor diversification

The 3 months correlation between C3 Ai and VTEX is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding C3 Ai Inc and VTEX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VTEX and C3 Ai 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 C3 Ai Inc are associated (or correlated) with VTEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VTEX has no effect on the direction of C3 Ai i.e., C3 Ai and VTEX go up and down completely randomly.

Pair Corralation between C3 Ai and VTEX

Allowing for the 90-day total investment horizon C3 Ai Inc is expected to under-perform the VTEX. But the stock apears to be less risky and, when comparing its historical volatility, C3 Ai Inc is 1.06 times less risky than VTEX. The stock trades about -0.18 of its potential returns per unit of risk. The VTEX is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  575.00  in VTEX on December 27, 2024 and sell it today you would lose (89.00) from holding VTEX or give up 15.48% of portfolio value over 90 days.

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

C3 Ai Inc  vs.  VTEX

C3 Ai Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days C3 Ai Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

VTEX

Risk-Adjusted Performance

Very Weak

Over the last 90 days VTEX has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with C3 Ai and VTEX

The main advantage of trading using opposite C3 Ai and VTEX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C3 Ai position performs unexpectedly, VTEX 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 VTEX will offset losses from the drop in VTEX's long position.

The idea behind C3 Ai Inc and VTEX 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.