Correlation Between Marqeta and Bridgeline Digital

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

By analyzing existing cross correlation between Marqeta and Bridgeline Digital, you can compare the effects of market volatilities on Marqeta and Bridgeline Digital 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 Bridgeline Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marqeta and Bridgeline Digital.

Diversification Opportunities for Marqeta and Bridgeline Digital

-0.05

Correlation Coefficient

Marqeta  Bridgeline Digital

Good diversification

The 3 months correlation between Marqeta and Bridgeline is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Marqeta and Bridgeline Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgeline Digital 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 Bridgeline Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgeline Digital has no effect on the direction of Marqeta i.e., Marqeta and Bridgeline Digital go up and down completely randomly.

Pair Corralation between Marqeta and Bridgeline Digital

Allowing for the 90-day total investment horizon Marqeta is expected to under-perform the Bridgeline Digital. In addition to that, Marqeta is 2.29 times more volatile than Bridgeline Digital. It trades about -0.03 of its total potential returns per unit of risk. Bridgeline Digital is currently generating about 0.08 per unit of volatility. If you would invest  107.00  in Bridgeline Digital on September 5, 2024 and sell it today you would earn a total of  13.00  from holding Bridgeline Digital or generate 12.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Marqeta  vs.  Bridgeline Digital

Marqeta

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marqeta has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unfluctuating performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Bridgeline Digital

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Bridgeline Digital are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Bridgeline Digital displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Marqeta and Bridgeline Digital

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

The idea behind Marqeta and Bridgeline Digital 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..