Correlation Between Marchex and Lig Assets
Can any of the company-specific risk be diversified away by investing in both Marchex and Lig Assets 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 Marchex and Lig Assets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marchex and Lig Assets, you can compare the effects of market volatilities on Marchex and Lig Assets 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 Marchex with a short position of Lig Assets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marchex and Lig Assets.
Diversification Opportunities for Marchex and Lig Assets
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Marchex and Lig is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Marchex and Lig Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lig Assets and Marchex 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 Marchex are associated (or correlated) with Lig Assets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lig Assets has no effect on the direction of Marchex i.e., Marchex and Lig Assets go up and down completely randomly.
Pair Corralation between Marchex and Lig Assets
Given the investment horizon of 90 days Marchex is expected to generate 3.71 times less return on investment than Lig Assets. But when comparing it to its historical volatility, Marchex is 2.43 times less risky than Lig Assets. It trades about 0.08 of its potential returns per unit of risk. Lig Assets is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1.44 in Lig Assets on December 3, 2024 and sell it today you would earn a total of 0.66 from holding Lig Assets or generate 45.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
Marchex vs. Lig Assets
Performance |
Timeline |
Marchex |
Lig Assets |
Marchex and Lig Assets Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marchex and Lig Assets
The main advantage of trading using opposite Marchex and Lig Assets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marchex position performs unexpectedly, Lig Assets 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 Lig Assets will offset losses from the drop in Lig Assets' long position.Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
Lig Assets vs. Impact Fusion International | Lig Assets vs. Baosheng Media Group | Lig Assets vs. Digital Brand Media | Lig Assets vs. Pervasip Corp |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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