Correlation Between Alta Global and Exagen

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

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

Diversification Opportunities for Alta Global and Exagen

-0.54

Correlation Coefficient

Alta Global  Exagen

Excellent diversification

The 3 months correlation between Alta and Exagen is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Alta Global Group and Exagen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exagen Inc and Alta Global 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 Alta Global Group are associated (or correlated) with Exagen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exagen Inc has no effect on the direction of Alta Global i.e., Alta Global and Exagen go up and down completely randomly.

Pair Corralation between Alta Global and Exagen

Considering the 90-day investment horizon Alta Global Group is expected to generate 0.99 times more return on investment than Exagen. However, Alta Global Group is 1.01 times less risky than Exagen. It trades about 0.05 of its potential returns per unit of risk. Exagen Inc is currently generating about -0.06 per unit of risk. If you would invest  121.00  in Alta Global Group on October 22, 2024 and sell it today you would earn a total of  1.00  from holding Alta Global Group or generate 0.83% return on investment over 90 days.

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

Alta Global Group  vs.  Exagen Inc

Alta Global Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alta Global Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's primary indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Exagen Inc

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Exagen Inc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Exagen displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alta Global and Exagen

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

The idea behind Alta Global Group and Exagen Inc 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.