Correlation Between Intuitive Machines and Weebit Nano

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

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

Diversification Opportunities for Intuitive Machines and Weebit Nano

0.83

Correlation Coefficient

Intuitive Machines  Weebit Nano

Very poor diversification

The 3 months correlation between Intuitive and Weebit is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Machines and Weebit Nano Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weebit Nano Limited and Intuitive Machines 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 Intuitive Machines are associated (or correlated) with Weebit Nano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weebit Nano Limited has no effect on the direction of Intuitive Machines i.e., Intuitive Machines and Weebit Nano go up and down completely randomly.

Pair Corralation between Intuitive Machines and Weebit Nano

Given the investment horizon of 90 days Intuitive Machines is expected to generate 2.24 times more return on investment than Weebit Nano. However, Intuitive Machines is 2.24 times more volatile than Weebit Nano Limited. It trades about 0.05 of its potential returns per unit of risk. Weebit Nano Limited is currently generating about 0.03 per unit of risk. If you would invest  1,000.00  in Intuitive Machines on September 20, 2024 and sell it today you would earn a total of  332.00  from holding Intuitive Machines or generate 33.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	99.8%
Values	Daily Returns

Intuitive Machines  vs.  Weebit Nano Limited

Intuitive Machines

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Machines are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Intuitive Machines reported solid returns over the last few months and may actually be approaching a breakup point.

Weebit Nano Limited

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Weebit Nano Limited are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Weebit Nano reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intuitive Machines and Weebit Nano

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

The idea behind Intuitive Machines and Weebit Nano Limited 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.