Correlation Between YXTCOM GROUP and Network 1

Can any of the company-specific risk be diversified away by investing in both YXTCOM GROUP and Network 1 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 YXTCOM GROUP and Network 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between YXTCOM GROUP HOLDING and Network 1 Technologies, you can compare the effects of market volatilities on YXTCOM GROUP and Network 1 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 YXTCOM GROUP with a short position of Network 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of YXTCOM GROUP and Network 1.

Diversification Opportunities for YXTCOM GROUP and Network 1

0.69

Correlation Coefficient

YXTCOM GROUP  Network 1

Poor diversification

The 3 months correlation between YXTCOM and Network is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding YXTCOM GROUP HOLDING and Network 1 Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Network 1 Technologies and YXTCOM GROUP 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 YXTCOM GROUP HOLDING are associated (or correlated) with Network 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Network 1 Technologies has no effect on the direction of YXTCOM GROUP i.e., YXTCOM GROUP and Network 1 go up and down completely randomly.

Pair Corralation between YXTCOM GROUP and Network 1

Considering the 90-day investment horizon YXTCOM GROUP HOLDING is expected to under-perform the Network 1. In addition to that, YXTCOM GROUP is 2.97 times more volatile than Network 1 Technologies. It trades about -0.05 of its total potential returns per unit of risk. Network 1 Technologies is currently generating about 0.07 per unit of volatility. If you would invest  134.00  in Network 1 Technologies on September 28, 2024 and sell it today you would earn a total of  4.00  from holding Network 1 Technologies or generate 2.99% return on investment over 90 days.

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

YXTCOM GROUP HOLDING  vs.  Network 1 Technologies

YXTCOM GROUP HOLDING

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in YXTCOM GROUP HOLDING are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, YXTCOM GROUP unveiled solid returns over the last few months and may actually be approaching a breakup point.

Network 1 Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Network 1 Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Network 1 is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with YXTCOM GROUP and Network 1

The main advantage of trading using opposite YXTCOM GROUP and Network 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YXTCOM GROUP position performs unexpectedly, Network 1 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 Network 1 will offset losses from the drop in Network 1's long position.

The idea behind YXTCOM GROUP HOLDING and Network 1 Technologies 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.