Correlation Between Swvl Holdings and HubSpot

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

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

Diversification Opportunities for Swvl Holdings and HubSpot

0.24

Correlation Coefficient

Swvl Holdings  HubSpot

Modest diversification

The 3 months correlation between Swvl and HubSpot is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Swvl Holdings Corp and HubSpot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HubSpot and Swvl Holdings 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 Swvl Holdings Corp are associated (or correlated) with HubSpot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HubSpot has no effect on the direction of Swvl Holdings i.e., Swvl Holdings and HubSpot go up and down completely randomly.

Pair Corralation between Swvl Holdings and HubSpot

Assuming the 90 days horizon Swvl Holdings Corp is expected to under-perform the HubSpot. In addition to that, Swvl Holdings is 2.15 times more volatile than HubSpot. It trades about -0.42 of its total potential returns per unit of risk. HubSpot is currently generating about 0.2 per unit of volatility. If you would invest  66,832  in HubSpot on September 17, 2024 and sell it today you would earn a total of  5,354  from holding HubSpot or generate 8.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	85.0%
Values	Daily Returns

Swvl Holdings Corp  vs.  HubSpot

Swvl Holdings Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Swvl Holdings Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal essential indicators, Swvl Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

HubSpot

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in HubSpot are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal fundamental drivers, HubSpot unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Swvl Holdings and HubSpot

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

The idea behind Swvl Holdings Corp and HubSpot 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.