Correlation Between Marqeta and TransUnion

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

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

Diversification Opportunities for Marqeta and TransUnion

0.31

Correlation Coefficient

Marqeta  TransUnion

Weak diversification

The 3 months correlation between Marqeta and TransUnion is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Marqeta and TransUnion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TransUnion 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 TransUnion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TransUnion has no effect on the direction of Marqeta i.e., Marqeta and TransUnion go up and down completely randomly.

Pair Corralation between Marqeta and TransUnion

Allowing for the 90-day total investment horizon Marqeta is expected to under-perform the TransUnion. In addition to that, Marqeta is 3.59 times more volatile than TransUnion. It trades about -0.02 of its total potential returns per unit of risk. TransUnion is currently generating about 0.03 per unit of volatility. If you would invest  9,614  in TransUnion on September 10, 2024 and sell it today you would earn a total of  205.00  from holding TransUnion or generate 2.13% return on investment over 90 days.

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

Marqeta  vs.  TransUnion

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.

TransUnion

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TransUnion are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, TransUnion is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Marqeta and TransUnion

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

The idea behind Marqeta and TransUnion 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.