Correlation Between Marqeta and A10 Network

Can any of the company-specific risk be diversified away by investing in both Marqeta and A10 Network 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 Marqeta and A10 Network into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Marqeta and A10 Network, you can compare the effects of market volatilities on Marqeta and A10 Network 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 Marqeta with a short position of A10 Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marqeta and A10 Network.

Diversification Opportunities for Marqeta and A10 Network

-0.4

Correlation Coefficient

Marqeta  A10 Network

Very good diversification

The 3 months correlation between Marqeta and A10 is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Marqeta and A10 Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A10 Network and Marqeta 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 Marqeta are associated (or correlated) with A10 Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A10 Network has no effect on the direction of Marqeta i.e., Marqeta and A10 Network go up and down completely randomly.

Pair Corralation between Marqeta and A10 Network

Allowing for the 90-day total investment horizon Marqeta is expected to generate 1.26 times more return on investment than A10 Network. However, Marqeta is 1.26 times more volatile than A10 Network. It trades about 0.1 of its potential returns per unit of risk. A10 Network is currently generating about -0.01 per unit of risk. If you would invest  365.00  in Marqeta on December 27, 2024 and sell it today you would earn a total of  74.00  from holding Marqeta or generate 20.27% return on investment over 90 days.

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

Marqeta  vs.  A10 Network

Marqeta

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Marqeta are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Marqeta reported solid returns over the last few months and may actually be approaching a breakup point.

A10 Network

Risk-Adjusted Performance

Very Weak

Over the last 90 days A10 Network has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, A10 Network is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Marqeta and A10 Network

The main advantage of trading using opposite Marqeta and A10 Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marqeta position performs unexpectedly, A10 Network 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 A10 Network will offset losses from the drop in A10 Network's long position.

The idea behind Marqeta and A10 Network 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.