Correlation Between Hub Cyber and Pinterest

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

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

Diversification Opportunities for Hub Cyber and Pinterest

-0.06

Correlation Coefficient

Hub Cyber  Pinterest

Good diversification

The 3 months correlation between Hub and Pinterest is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Hub Cyber Security and Pinterest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinterest and Hub Cyber 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 Hub Cyber Security are associated (or correlated) with Pinterest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinterest has no effect on the direction of Hub Cyber i.e., Hub Cyber and Pinterest go up and down completely randomly.

Pair Corralation between Hub Cyber and Pinterest

Assuming the 90 days horizon Hub Cyber Security is expected to under-perform the Pinterest. In addition to that, Hub Cyber is 3.85 times more volatile than Pinterest. It trades about -0.04 of its total potential returns per unit of risk. Pinterest is currently generating about 0.11 per unit of volatility. If you would invest  3,039  in Pinterest on September 12, 2024 and sell it today you would earn a total of  144.00  from holding Pinterest or generate 4.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Hub Cyber Security  vs.  Pinterest

Hub Cyber Security

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hub Cyber Security are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental indicators, Hub Cyber showed solid returns over the last few months and may actually be approaching a breakup point.

Pinterest

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Pinterest are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Pinterest may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Hub Cyber and Pinterest

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

The idea behind Hub Cyber Security and Pinterest 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.