Correlation Between Velo3D and Markforged Holding

Can any of the company-specific risk be diversified away by investing in both Velo3D and Markforged Holding 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 Velo3D and Markforged Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Velo3D Inc and Markforged Holding Corp, you can compare the effects of market volatilities on Velo3D and Markforged Holding 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 Velo3D with a short position of Markforged Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Velo3D and Markforged Holding.

Diversification Opportunities for Velo3D and Markforged Holding

0.0

Correlation Coefficient

Velo3D  Markforged Holding

Pay attention - limited upside

The 3 months correlation between Velo3D and Markforged is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Velo3D Inc and Markforged Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Markforged Holding Corp and Velo3D 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 Velo3D Inc are associated (or correlated) with Markforged Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Markforged Holding Corp has no effect on the direction of Velo3D i.e., Velo3D and Markforged Holding go up and down completely randomly.

Pair Corralation between Velo3D and Markforged Holding

If you would invest  314.00  in Markforged Holding Corp on December 29, 2024 and sell it today you would earn a total of  143.00  from holding Markforged Holding Corp or generate 45.54% return on investment over 90 days.

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

Velo3D Inc  vs.  Markforged Holding Corp

Velo3D Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Velo3D Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, Velo3D is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Markforged Holding Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Markforged Holding Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Markforged Holding reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Velo3D and Markforged Holding

The main advantage of trading using opposite Velo3D and Markforged Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Velo3D position performs unexpectedly, Markforged Holding 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 Markforged Holding will offset losses from the drop in Markforged Holding's long position.

The idea behind Velo3D Inc and Markforged Holding Corp 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.