Correlation Between ETF Managers and SonicShares Global

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

By analyzing existing cross correlation between ETF Managers Group and SonicShares Global Shipping, you can compare the effects of market volatilities on ETF Managers and SonicShares Global 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 ETF Managers with a short position of SonicShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETF Managers and SonicShares Global.

Diversification Opportunities for ETF Managers and SonicShares Global

0.37

Correlation Coefficient

ETF Managers  SonicShares Global

Weak diversification

The 3 months correlation between ETF and SonicShares is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding ETF Managers Group and SonicShares Global Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SonicShares Global and ETF Managers 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 ETF Managers Group are associated (or correlated) with SonicShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SonicShares Global has no effect on the direction of ETF Managers i.e., ETF Managers and SonicShares Global go up and down completely randomly.

Pair Corralation between ETF Managers and SonicShares Global

If you would invest  1,980  in ETF Managers Group on September 14, 2024 and sell it today you would earn a total of  0.00  from holding ETF Managers Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

ETF Managers Group  vs.  SonicShares Global Shipping

ETF Managers Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ETF Managers Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, ETF Managers is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

SonicShares Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SonicShares Global Shipping has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the exchange-traded fund private investors.

Pair Trading with ETF Managers and SonicShares Global

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

The idea behind ETF Managers Group and SonicShares Global Shipping 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.

Check out your portfolio center.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.