Correlation Between Expensify and Where Food

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

By analyzing existing cross correlation between Expensify and Where Food Comes, you can compare the effects of market volatilities on Expensify and Where Food 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 Where Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expensify and Where Food.

Diversification Opportunities for Expensify and Where Food

-0.03

Correlation Coefficient

Expensify  Where Food

Good diversification

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

Pair Corralation between Expensify and Where Food

Given the investment horizon of 90 days Expensify is expected to generate 1.52 times more return on investment than Where Food. However, Expensify is 1.52 times more volatile than Where Food Comes. It trades about 0.0 of its potential returns per unit of risk. Where Food Comes is currently generating about -0.05 per unit of risk. If you would invest  348.00  in Expensify on December 29, 2024 and sell it today you would lose (17.00) from holding Expensify or give up 4.89% of portfolio value over 90 days.

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

Expensify  vs.  Where Food Comes

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.

Where Food Comes

Risk-Adjusted Performance

Very Weak

Over the last 90 days Where Food Comes has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Expensify and Where Food

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

The idea behind Expensify and Where Food Comes 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.