Correlation Between MicroAlgo and Repay Holdings

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

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

Diversification Opportunities for MicroAlgo and Repay Holdings

-0.18

Correlation Coefficient

MicroAlgo  Repay Holdings

Good diversification

The 3 months correlation between MicroAlgo and Repay is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding MicroAlgo and Repay Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Repay Holdings Corp and MicroAlgo 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 MicroAlgo are associated (or correlated) with Repay Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Repay Holdings Corp has no effect on the direction of MicroAlgo i.e., MicroAlgo and Repay Holdings go up and down completely randomly.

Pair Corralation between MicroAlgo and Repay Holdings

Given the investment horizon of 90 days MicroAlgo is expected to under-perform the Repay Holdings. In addition to that, MicroAlgo is 4.62 times more volatile than Repay Holdings Corp. It trades about -0.07 of its total potential returns per unit of risk. Repay Holdings Corp is currently generating about -0.01 per unit of volatility. If you would invest  834.00  in Repay Holdings Corp on September 1, 2024 and sell it today you would lose (26.00) from holding Repay Holdings Corp or give up 3.12% of portfolio value over 90 days.

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

MicroAlgo  vs.  Repay Holdings Corp

MicroAlgo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MicroAlgo has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Repay Holdings Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with MicroAlgo and Repay Holdings

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

The idea behind MicroAlgo and Repay Holdings 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.