Correlation Between Beyond Commerce and Cheer Holding

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

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

Diversification Opportunities for Beyond Commerce and Cheer Holding

0.03

Correlation Coefficient

Beyond Commerce  Cheer Holding

Significant diversification

The 3 months correlation between Beyond and Cheer is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Commerce and Cheer Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheer Holding and Beyond Commerce 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 Beyond Commerce are associated (or correlated) with Cheer Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheer Holding has no effect on the direction of Beyond Commerce i.e., Beyond Commerce and Cheer Holding go up and down completely randomly.

Pair Corralation between Beyond Commerce and Cheer Holding

Given the investment horizon of 90 days Beyond Commerce is expected to generate 13.49 times more return on investment than Cheer Holding. However, Beyond Commerce is 13.49 times more volatile than Cheer Holding. It trades about 0.11 of its potential returns per unit of risk. Cheer Holding is currently generating about 0.08 per unit of risk. If you would invest  0.02  in Beyond Commerce on September 25, 2024 and sell it today you would lose (0.01) from holding Beyond Commerce or give up 50.0% of portfolio value over 90 days.

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

Beyond Commerce  vs.  Cheer Holding

Beyond Commerce

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Beyond Commerce are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Beyond Commerce exhibited solid returns over the last few months and may actually be approaching a breakup point.

Cheer Holding

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cheer Holding are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical indicators, Cheer Holding is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Beyond Commerce and Cheer Holding

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

The idea behind Beyond Commerce and Cheer Holding 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.