Correlation Between NexGel Warrant and Cricut

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

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

Diversification Opportunities for NexGel Warrant and Cricut

-0.22

Correlation Coefficient

NexGel Warrant  Cricut

Very good diversification

The 3 months correlation between NexGel and Cricut is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding NexGel Warrant and Cricut Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cricut Inc and NexGel Warrant 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 NexGel Warrant are associated (or correlated) with Cricut. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cricut Inc has no effect on the direction of NexGel Warrant i.e., NexGel Warrant and Cricut go up and down completely randomly.

Pair Corralation between NexGel Warrant and Cricut

Assuming the 90 days horizon NexGel Warrant is expected to generate 5.12 times more return on investment than Cricut. However, NexGel Warrant is 5.12 times more volatile than Cricut Inc. It trades about 0.24 of its potential returns per unit of risk. Cricut Inc is currently generating about 0.11 per unit of risk. If you would invest  47.00  in NexGel Warrant on October 6, 2024 and sell it today you would earn a total of  28.00  from holding NexGel Warrant or generate 59.57% return on investment over 90 days.

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

NexGel Warrant  vs.  Cricut Inc

NexGel Warrant

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NexGel Warrant are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting essential indicators, NexGel Warrant showed solid returns over the last few months and may actually be approaching a breakup point.

Cricut Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cricut Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Cricut 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 NexGel Warrant and Cricut

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

The idea behind NexGel Warrant and Cricut Inc 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.