Correlation Between Interups and Xtra Energy

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Can any of the company-specific risk be diversified away by investing in both Interups and Xtra Energy 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 Interups and Xtra Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interups and Xtra Energy Corp, you can compare the effects of market volatilities on Interups and Xtra Energy 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 Interups with a short position of Xtra Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interups and Xtra Energy.

Diversification Opportunities for Interups and Xtra Energy

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Interups and Xtra is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Interups and Xtra Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtra Energy Corp and Interups 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 Interups are associated (or correlated) with Xtra Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtra Energy Corp has no effect on the direction of Interups i.e., Interups and Xtra Energy go up and down completely randomly.

Pair Corralation between Interups and Xtra Energy

If you would invest  16.00  in Xtra Energy Corp on September 18, 2024 and sell it today you would earn a total of  6.00  from holding Xtra Energy Corp or generate 37.5% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Interups  vs.  Xtra Energy Corp

 Performance 
       Timeline  
Interups 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Interups has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Interups is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.
Xtra Energy Corp 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Xtra Energy Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Xtra Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Interups and Xtra Energy Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Interups and Xtra Energy

The main advantage of trading using opposite Interups and Xtra Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interups position performs unexpectedly, Xtra Energy 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 Xtra Energy will offset losses from the drop in Xtra Energy's long position.
The idea behind Interups and Xtra Energy Corp 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

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