Correlation Between NVIDIACDR and Fobi AI

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

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

Diversification Opportunities for NVIDIACDR and Fobi AI

0.0

Correlation Coefficient

NVIDIACDR  Fobi AI

Pay attention - limited upside

The 3 months correlation between NVIDIACDR and Fobi is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NVIDIA CDR and Fobi AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fobi AI and NVIDIACDR 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 NVIDIA CDR are associated (or correlated) with Fobi AI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fobi AI has no effect on the direction of NVIDIACDR i.e., NVIDIACDR and Fobi AI go up and down completely randomly.

Pair Corralation between NVIDIACDR and Fobi AI

If you would invest  4.00  in Fobi AI on December 2, 2024 and sell it today you would earn a total of  0.00  from holding Fobi AI or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

NVIDIA CDR  vs.  Fobi AI

NVIDIA CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days NVIDIA CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Fobi AI

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fobi AI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental drivers, Fobi AI is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with NVIDIACDR and Fobi AI

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

The idea behind NVIDIA CDR and Fobi AI 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.