Correlation Between MoneyHero Limited and Stagwell

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

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

Diversification Opportunities for MoneyHero Limited and Stagwell

0.46

Correlation Coefficient

MoneyHero Limited  Stagwell

Very weak diversification

The 3 months correlation between MoneyHero and Stagwell is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding MoneyHero Limited Class and Stagwell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stagwell and MoneyHero Limited 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 MoneyHero Limited Class are associated (or correlated) with Stagwell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stagwell has no effect on the direction of MoneyHero Limited i.e., MoneyHero Limited and Stagwell go up and down completely randomly.

Pair Corralation between MoneyHero Limited and Stagwell

Considering the 90-day investment horizon MoneyHero Limited Class is expected to generate 3.07 times more return on investment than Stagwell. However, MoneyHero Limited is 3.07 times more volatile than Stagwell. It trades about -0.05 of its potential returns per unit of risk. Stagwell is currently generating about -0.68 per unit of risk. If you would invest  120.00  in MoneyHero Limited Class on October 9, 2024 and sell it today you would lose (5.00) from holding MoneyHero Limited Class or give up 4.17% of portfolio value over 90 days.

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

MoneyHero Limited Class  vs.  Stagwell

MoneyHero Limited Class

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MoneyHero Limited Class are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, MoneyHero Limited showed solid returns over the last few months and may actually be approaching a breakup point.

Stagwell

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stagwell has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with MoneyHero Limited and Stagwell

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

The idea behind MoneyHero Limited Class and Stagwell 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.