Correlation Between Humbl and Forwardly

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

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

Diversification Opportunities for Humbl and Forwardly

0.85

Correlation Coefficient

Humbl  Forwardly

Very poor diversification

The 3 months correlation between Humbl and Forwardly is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Humbl Inc and Forwardly in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forwardly and Humbl 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 Humbl Inc are associated (or correlated) with Forwardly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forwardly has no effect on the direction of Humbl i.e., Humbl and Forwardly go up and down completely randomly.

Pair Corralation between Humbl and Forwardly

Given the investment horizon of 90 days Humbl Inc is expected to under-perform the Forwardly. In addition to that, Humbl is 1.4 times more volatile than Forwardly. It trades about -0.13 of its total potential returns per unit of risk. Forwardly is currently generating about -0.04 per unit of volatility. If you would invest  0.95  in Forwardly on December 29, 2024 and sell it today you would lose (0.26) from holding Forwardly or give up 27.37% of portfolio value over 90 days.

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

Humbl Inc  vs.  Forwardly

Humbl Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Humbl Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Forwardly

Risk-Adjusted Performance

Very Weak

Over the last 90 days Forwardly has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Humbl and Forwardly

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

The idea behind Humbl Inc and Forwardly 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.