Correlation Between Asure Software and XCHG Limited

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

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

Diversification Opportunities for Asure Software and XCHG Limited

0.06

Correlation Coefficient

Asure Software  XCHG Limited

Significant diversification

The 3 months correlation between Asure and XCHG is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and XCHG Limited American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XCHG Limited American and Asure Software 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 Asure Software are associated (or correlated) with XCHG Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XCHG Limited American has no effect on the direction of Asure Software i.e., Asure Software and XCHG Limited go up and down completely randomly.

Pair Corralation between Asure Software and XCHG Limited

Given the investment horizon of 90 days Asure Software is expected to generate 146.71 times less return on investment than XCHG Limited. But when comparing it to its historical volatility, Asure Software is 33.38 times less risky than XCHG Limited. It trades about 0.03 of its potential returns per unit of risk. XCHG Limited American is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  0.00  in XCHG Limited American on October 10, 2024 and sell it today you would earn a total of  208.00  from holding XCHG Limited American or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	16.97%
Values	Daily Returns

Asure Software  vs.  XCHG Limited American

Asure Software

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Asure Software reported solid returns over the last few months and may actually be approaching a breakup point.

XCHG Limited American

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days XCHG Limited American has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, XCHG Limited is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Asure Software and XCHG Limited

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

The idea behind Asure Software and XCHG Limited American 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..