Correlation Between BASE and EzFill Holdings

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

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

Diversification Opportunities for BASE and EzFill Holdings

0.79

Correlation Coefficient

BASE  EzFill Holdings

Poor diversification

The 3 months correlation between BASE and EzFill is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding BASE Inc and EzFill Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EzFill Holdings and BASE 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 BASE Inc are associated (or correlated) with EzFill Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EzFill Holdings has no effect on the direction of BASE i.e., BASE and EzFill Holdings go up and down completely randomly.

Pair Corralation between BASE and EzFill Holdings

Assuming the 90 days horizon BASE is expected to generate 1.69 times less return on investment than EzFill Holdings. But when comparing it to its historical volatility, BASE Inc is 2.27 times less risky than EzFill Holdings. It trades about 0.14 of its potential returns per unit of risk. EzFill Holdings is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  266.00  in EzFill Holdings on December 1, 2024 and sell it today you would earn a total of  84.00  from holding EzFill Holdings or generate 31.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	83.61%
Values	Daily Returns

BASE Inc  vs.  EzFill Holdings

BASE Inc

Risk-Adjusted Performance

Good

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

EzFill Holdings

Risk-Adjusted Performance

OK

Over the last 90 days EzFill Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite conflicting technical and fundamental indicators, EzFill Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BASE and EzFill Holdings

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

The idea behind BASE Inc and EzFill Holdings 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.