Correlation Between HyreCar and FlexShopper

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

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

Diversification Opportunities for HyreCar and FlexShopper

-0.64

Correlation Coefficient

HyreCar  FlexShopper

Excellent diversification

The 3 months correlation between HyreCar and FlexShopper is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding HyreCar and FlexShopper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FlexShopper and HyreCar 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 HyreCar are associated (or correlated) with FlexShopper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FlexShopper has no effect on the direction of HyreCar i.e., HyreCar and FlexShopper go up and down completely randomly.

Pair Corralation between HyreCar and FlexShopper

Assuming the 90 days horizon HyreCar is expected to under-perform the FlexShopper. In addition to that, HyreCar is 2.5 times more volatile than FlexShopper. It trades about -0.13 of its total potential returns per unit of risk. FlexShopper is currently generating about 0.23 per unit of volatility. If you would invest  101.00  in FlexShopper on September 12, 2024 and sell it today you would earn a total of  95.00  from holding FlexShopper or generate 94.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.88%
Values	Daily Returns

HyreCar  vs.  FlexShopper

HyreCar

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HyreCar has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

FlexShopper

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FlexShopper are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, FlexShopper showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HyreCar and FlexShopper

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

The idea behind HyreCar and FlexShopper 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.