Correlation Between Royalty Management and Veea

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

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

Diversification Opportunities for Royalty Management and Veea

-0.37

Correlation Coefficient

Royalty Management  Veea

Very good diversification

The 3 months correlation between Royalty and Veea is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Royalty Management Holding and Veea Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veea Inc and Royalty Management 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 Royalty Management Holding are associated (or correlated) with Veea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veea Inc has no effect on the direction of Royalty Management i.e., Royalty Management and Veea go up and down completely randomly.

Pair Corralation between Royalty Management and Veea

Given the investment horizon of 90 days Royalty Management is expected to generate 607.43 times less return on investment than Veea. But when comparing it to its historical volatility, Royalty Management Holding is 1.29 times less risky than Veea. It trades about 0.0 of its potential returns per unit of risk. Veea Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  350.00  in Veea Inc on October 6, 2024 and sell it today you would earn a total of  35.00  from holding Veea Inc or generate 10.0% return on investment over 90 days.

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

Royalty Management Holding  vs.  Veea Inc

Royalty Management

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Royalty Management Holding are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile fundamental indicators, Royalty Management displayed solid returns over the last few months and may actually be approaching a breakup point.

Veea Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Veea Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Royalty Management and Veea

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

The idea behind Royalty Management Holding and Veea 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.