Correlation Between VERB TECHNOLOGY and LYFT

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

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

Diversification Opportunities for VERB TECHNOLOGY and LYFT

-0.62

Correlation Coefficient

VERB TECHNOLOGY  LYFT

Excellent diversification

The 3 months correlation between VERB and LYFT is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding VERB TECHNOLOGY PANY and LYFT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LYFT Inc and VERB TECHNOLOGY 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 VERB TECHNOLOGY PANY are associated (or correlated) with LYFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LYFT Inc has no effect on the direction of VERB TECHNOLOGY i.e., VERB TECHNOLOGY and LYFT go up and down completely randomly.

Pair Corralation between VERB TECHNOLOGY and LYFT

Given the investment horizon of 90 days VERB TECHNOLOGY is expected to generate 3.83 times less return on investment than LYFT. In addition to that, VERB TECHNOLOGY is 3.47 times more volatile than LYFT Inc. It trades about 0.01 of its total potential returns per unit of risk. LYFT Inc is currently generating about 0.17 per unit of volatility. If you would invest  1,167  in LYFT Inc on August 30, 2024 and sell it today you would earn a total of  551.00  from holding LYFT Inc or generate 47.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

VERB TECHNOLOGY PANY  vs.  LYFT Inc

VERB TECHNOLOGY PANY

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in VERB TECHNOLOGY PANY are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent basic indicators, VERB TECHNOLOGY may actually be approaching a critical reversion point that can send shares even higher in December 2024.

LYFT Inc

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in LYFT Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical and fundamental indicators, LYFT unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VERB TECHNOLOGY and LYFT

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

The idea behind VERB TECHNOLOGY PANY and LYFT 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.