Correlation Between Marqeta and Ironnet

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

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

Diversification Opportunities for Marqeta and Ironnet

0.43

Correlation Coefficient

Marqeta  Ironnet

Very weak diversification

The 3 months correlation between Marqeta and Ironnet is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Marqeta and Ironnet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ironnet 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 Ironnet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ironnet has no effect on the direction of Marqeta i.e., Marqeta and Ironnet go up and down completely randomly.

Pair Corralation between Marqeta and Ironnet

If you would invest  390.00  in Marqeta on September 19, 2024 and sell it today you would lose (1.00) from holding Marqeta or give up 0.26% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	4.76%
Values	Daily Returns

Marqeta  vs.  Ironnet

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 unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Ironnet

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ironnet has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Ironnet is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Marqeta and Ironnet

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

The idea behind Marqeta and Ironnet 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.