Correlation Between Expensify and CoreCard Corp

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

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

Diversification Opportunities for Expensify and CoreCard Corp

0.45

Correlation Coefficient

Expensify  CoreCard Corp

Very weak diversification

The 3 months correlation between Expensify and CoreCard is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Expensify and CoreCard Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreCard Corp and Expensify 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 Expensify are associated (or correlated) with CoreCard Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreCard Corp has no effect on the direction of Expensify i.e., Expensify and CoreCard Corp go up and down completely randomly.

Pair Corralation between Expensify and CoreCard Corp

Given the investment horizon of 90 days Expensify is expected to generate 1.38 times more return on investment than CoreCard Corp. However, Expensify is 1.38 times more volatile than CoreCard Corp. It trades about -0.02 of its potential returns per unit of risk. CoreCard Corp is currently generating about -0.06 per unit of risk. If you would invest  348.00  in Expensify on December 30, 2024 and sell it today you would lose (37.00) from holding Expensify or give up 10.63% of portfolio value over 90 days.

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

Expensify  vs.  CoreCard Corp

Expensify

Risk-Adjusted Performance

Very Weak

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

CoreCard Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days CoreCard Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Expensify and CoreCard Corp

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

The idea behind Expensify and CoreCard Corp 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.