Correlation Between IZEA and 36Kr Holdings

Can any of the company-specific risk be diversified away by investing in both IZEA and 36Kr Holdings 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 IZEA and 36Kr Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between IZEA Inc and 36Kr Holdings, you can compare the effects of market volatilities on IZEA and 36Kr Holdings 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 IZEA with a short position of 36Kr Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of IZEA and 36Kr Holdings.

Diversification Opportunities for IZEA and 36Kr Holdings

-0.57

Correlation Coefficient

IZEA  36Kr Holdings

Excellent diversification

The 3 months correlation between IZEA and 36Kr is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding IZEA Inc and 36Kr Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 36Kr Holdings and IZEA 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 IZEA Inc are associated (or correlated) with 36Kr Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 36Kr Holdings has no effect on the direction of IZEA i.e., IZEA and 36Kr Holdings go up and down completely randomly.

Pair Corralation between IZEA and 36Kr Holdings

Given the investment horizon of 90 days IZEA Inc is expected to generate 0.57 times more return on investment than 36Kr Holdings. However, IZEA Inc is 1.77 times less risky than 36Kr Holdings. It trades about -0.12 of its potential returns per unit of risk. 36Kr Holdings is currently generating about -0.34 per unit of risk. If you would invest  288.00  in IZEA Inc on August 31, 2024 and sell it today you would lose (18.00) from holding IZEA Inc or give up 6.25% of portfolio value over 90 days.

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

IZEA Inc  vs.  36Kr Holdings

IZEA Inc

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IZEA Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating technical and fundamental indicators, IZEA sustained solid returns over the last few months and may actually be approaching a breakup point.

36Kr Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 36Kr Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in December 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with IZEA and 36Kr Holdings

The main advantage of trading using opposite IZEA and 36Kr Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IZEA position performs unexpectedly, 36Kr Holdings 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 36Kr Holdings will offset losses from the drop in 36Kr Holdings' long position.

The idea behind IZEA Inc and 36Kr Holdings 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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .