Correlation Between BSQUARE and Paltalk

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

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

Diversification Opportunities for BSQUARE and Paltalk

-0.64

Correlation Coefficient

BSQUARE  Paltalk

Excellent diversification

The 3 months correlation between BSQUARE and Paltalk is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding BSQUARE and Paltalk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paltalk and BSQUARE 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 BSQUARE are associated (or correlated) with Paltalk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paltalk has no effect on the direction of BSQUARE i.e., BSQUARE and Paltalk go up and down completely randomly.

Pair Corralation between BSQUARE and Paltalk

If you would invest  174.00  in Paltalk on October 26, 2024 and sell it today you would earn a total of  29.00  from holding Paltalk or generate 16.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	14.29%
Values	Daily Returns

BSQUARE  vs.  Paltalk

BSQUARE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BSQUARE has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, BSQUARE is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Paltalk

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Paltalk has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively weak essential indicators, Paltalk may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with BSQUARE and Paltalk

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

The idea behind BSQUARE and Paltalk 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.