Correlation Between Freight Technologies and Blackboxstocks

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

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

Diversification Opportunities for Freight Technologies and Blackboxstocks

0.01

Correlation Coefficient

Freight Technologies  Blackboxstocks

Significant diversification

The 3 months correlation between Freight and Blackboxstocks is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Freight Technologies and Blackboxstocks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackboxstocks and Freight Technologies 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 Freight Technologies are associated (or correlated) with Blackboxstocks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackboxstocks has no effect on the direction of Freight Technologies i.e., Freight Technologies and Blackboxstocks go up and down completely randomly.

Pair Corralation between Freight Technologies and Blackboxstocks

Given the investment horizon of 90 days Freight Technologies is expected to under-perform the Blackboxstocks. In addition to that, Freight Technologies is 1.12 times more volatile than Blackboxstocks. It trades about -0.11 of its total potential returns per unit of risk. Blackboxstocks is currently generating about 0.02 per unit of volatility. If you would invest  260.00  in Blackboxstocks on September 26, 2024 and sell it today you would lose (81.00) from holding Blackboxstocks or give up 31.15% of portfolio value over 90 days.

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

Freight Technologies  vs.  Blackboxstocks

Freight Technologies

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Freight Technologies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Freight Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Blackboxstocks

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackboxstocks has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Freight Technologies and Blackboxstocks

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

The idea behind Freight Technologies and Blackboxstocks 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.