Correlation Between Inpixon and Balincan USA

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

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

Diversification Opportunities for Inpixon and Balincan USA

0.41

Correlation Coefficient

Inpixon  Balincan USA

Very weak diversification

The 3 months correlation between Inpixon and Balincan is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Inpixon and Balincan USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balincan USA and Inpixon 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 Inpixon are associated (or correlated) with Balincan USA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balincan USA has no effect on the direction of Inpixon i.e., Inpixon and Balincan USA go up and down completely randomly.

Pair Corralation between Inpixon and Balincan USA

Given the investment horizon of 90 days Inpixon is expected to under-perform the Balincan USA. But the stock apears to be less risky and, when comparing its historical volatility, Inpixon is 4.95 times less risky than Balincan USA. The stock trades about -0.43 of its potential returns per unit of risk. The Balincan USA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  0.35  in Balincan USA on September 7, 2024 and sell it today you would earn a total of  0.03  from holding Balincan USA or generate 8.57% return on investment over 90 days.

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

Inpixon  vs.  Balincan USA

Inpixon

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inpixon has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Inpixon is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Balincan USA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Balincan USA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Balincan USA is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Inpixon and Balincan USA

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

The idea behind Inpixon and Balincan USA 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.

Check out your portfolio center.

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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.