Correlation Between Perion Network and MoneyHero Limited

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

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

Diversification Opportunities for Perion Network and MoneyHero Limited

0.63

Correlation Coefficient

Perion Network  MoneyHero Limited

Poor diversification

The 3 months correlation between Perion and MoneyHero is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Perion Network and MoneyHero Limited Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MoneyHero Limited Class and Perion Network 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 Perion Network are associated (or correlated) with MoneyHero Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MoneyHero Limited Class has no effect on the direction of Perion Network i.e., Perion Network and MoneyHero Limited go up and down completely randomly.

Pair Corralation between Perion Network and MoneyHero Limited

Given the investment horizon of 90 days Perion Network is expected to generate 0.64 times more return on investment than MoneyHero Limited. However, Perion Network is 1.55 times less risky than MoneyHero Limited. It trades about 0.06 of its potential returns per unit of risk. MoneyHero Limited Class is currently generating about 0.01 per unit of risk. If you would invest  788.00  in Perion Network on September 28, 2024 and sell it today you would earn a total of  49.00  from holding Perion Network or generate 6.22% return on investment over 90 days.

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

Perion Network  vs.  MoneyHero Limited Class

Perion Network

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Perion Network are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Perion Network may actually be approaching a critical reversion point that can send shares even higher in January 2025.

MoneyHero Limited Class

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days MoneyHero Limited Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, MoneyHero Limited is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Perion Network and MoneyHero Limited

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

The idea behind Perion Network and MoneyHero Limited Class 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.