Correlation Between CXApp and LiveChat Software

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

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

Diversification Opportunities for CXApp and LiveChat Software

0.29

Correlation Coefficient

CXApp  LiveChat Software

Modest diversification

The 3 months correlation between CXApp and LiveChat is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding CXApp Inc and LiveChat Software SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiveChat Software and CXApp 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 CXApp Inc are associated (or correlated) with LiveChat Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiveChat Software has no effect on the direction of CXApp i.e., CXApp and LiveChat Software go up and down completely randomly.

Pair Corralation between CXApp and LiveChat Software

Assuming the 90 days horizon CXApp Inc is expected to generate 7.21 times more return on investment than LiveChat Software. However, CXApp is 7.21 times more volatile than LiveChat Software SA. It trades about 0.08 of its potential returns per unit of risk. LiveChat Software SA is currently generating about 0.0 per unit of risk. If you would invest  7.00  in CXApp Inc on September 26, 2024 and sell it today you would earn a total of  14.00  from holding CXApp Inc or generate 200.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.59%
Values	Daily Returns

CXApp Inc  vs.  LiveChat Software SA

CXApp Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CXApp Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward indicators, CXApp is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

LiveChat Software

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LiveChat Software SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with CXApp and LiveChat Software

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

The idea behind CXApp Inc and LiveChat Software SA 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.