Correlation Between Appen and Xalles Holdings
Can any of the company-specific risk be diversified away by investing in both Appen and Xalles Holdings 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 Appen and Xalles Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Appen Limited and Xalles Holdings, you can compare the effects of market volatilities on Appen and Xalles Holdings 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 Appen with a short position of Xalles Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Appen and Xalles Holdings.
Diversification Opportunities for Appen and Xalles Holdings
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Appen and Xalles is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Appen Limited and Xalles Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xalles Holdings and Appen 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 Appen Limited are associated (or correlated) with Xalles Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xalles Holdings has no effect on the direction of Appen i.e., Appen and Xalles Holdings go up and down completely randomly.
Pair Corralation between Appen and Xalles Holdings
Assuming the 90 days horizon Appen Limited is expected to generate 1.43 times more return on investment than Xalles Holdings. However, Appen is 1.43 times more volatile than Xalles Holdings. It trades about 0.09 of its potential returns per unit of risk. Xalles Holdings is currently generating about 0.01 per unit of risk. If you would invest 56.00 in Appen Limited on September 2, 2024 and sell it today you would earn a total of 96.00 from holding Appen Limited or generate 171.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Appen Limited vs. Xalles Holdings
Performance |
| Timeline |
| Appen Limited |
| Xalles Holdings |
Appen and Xalles Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Appen and Xalles Holdings
The main advantage of trading using opposite Appen and Xalles Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Appen position performs unexpectedly, Xalles Holdings 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 Xalles Holdings will offset losses from the drop in Xalles Holdings' long position.| Appen vs. Appen Limited | Appen vs. Direct Communication Solutions | Appen vs. Capgemini SE ADR | Appen vs. Quisitive Technology Solutions |
| Xalles Holdings vs. Two Hands Corp | Xalles Holdings vs. Visium Technologies | Xalles Holdings vs. Tautachrome | Xalles Holdings vs. V Group |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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