Correlation Between SoundHound and SAITW Old

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

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

Diversification Opportunities for SoundHound and SAITW Old

0.0

Correlation Coefficient

SoundHound  SAITW Old

Pay attention - limited upside

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

Pair Corralation between SoundHound and SAITW Old

If you would invest (100.00) in SAITW Old on December 21, 2024 and sell it today you would earn a total of  100.00  from holding SAITW Old or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SoundHound AI  vs.  SAITW Old

SoundHound AI

Risk-Adjusted Performance

Very Weak

Over the last 90 days SoundHound AI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

SAITW Old

Risk-Adjusted Performance

Very Weak

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

Pair Trading with SoundHound and SAITW Old

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

The idea behind SoundHound AI and SAITW Old 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.

Check out your portfolio center.

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.