Correlation Between Nukkleus and Thinkific Labs

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

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

Diversification Opportunities for Nukkleus and Thinkific Labs

-0.32

Correlation Coefficient

Nukkleus  Thinkific Labs

Very good diversification

The 3 months correlation between Nukkleus and Thinkific is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Nukkleus and Thinkific Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thinkific Labs and Nukkleus 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 Nukkleus are associated (or correlated) with Thinkific Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thinkific Labs has no effect on the direction of Nukkleus i.e., Nukkleus and Thinkific Labs go up and down completely randomly.

Pair Corralation between Nukkleus and Thinkific Labs

Given the investment horizon of 90 days Nukkleus is expected to under-perform the Thinkific Labs. In addition to that, Nukkleus is 6.3 times more volatile than Thinkific Labs. It trades about -0.07 of its total potential returns per unit of risk. Thinkific Labs is currently generating about -0.04 per unit of volatility. If you would invest  204.00  in Thinkific Labs on December 21, 2024 and sell it today you would lose (11.00) from holding Thinkific Labs or give up 5.39% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.75%
Values	Daily Returns

Nukkleus  vs.  Thinkific Labs

Nukkleus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nukkleus has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Thinkific Labs

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thinkific Labs has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Thinkific Labs is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Nukkleus and Thinkific Labs

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

The idea behind Nukkleus and Thinkific Labs 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.