Correlation Between Nogin and Presto Automation

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

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

Diversification Opportunities for Nogin and Presto Automation

0.81

Correlation Coefficient

Nogin  Presto Automation

Very poor diversification

The 3 months correlation between Nogin and Presto is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Nogin Inc and Presto Automation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Presto Automation and Nogin 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 Nogin Inc are associated (or correlated) with Presto Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Presto Automation has no effect on the direction of Nogin i.e., Nogin and Presto Automation go up and down completely randomly.

Pair Corralation between Nogin and Presto Automation

Given the investment horizon of 90 days Nogin Inc is expected to under-perform the Presto Automation. In addition to that, Nogin is 1.08 times more volatile than Presto Automation. It trades about -0.07 of its total potential returns per unit of risk. Presto Automation is currently generating about -0.04 per unit of volatility. If you would invest  398.00  in Presto Automation on October 26, 2024 and sell it today you would lose (397.53) from holding Presto Automation or give up 99.88% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	30.55%
Values	Daily Returns

Nogin Inc  vs.  Presto Automation

Nogin Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Presto Automation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Presto Automation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Presto Automation 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 Nogin and Presto Automation

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

The idea behind Nogin Inc and Presto Automation 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.