Correlation Between CXApp and Marketwise
Can any of the company-specific risk be diversified away by investing in both CXApp and Marketwise 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 CXApp and Marketwise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CXApp Inc and Marketwise, you can compare the effects of market volatilities on CXApp and Marketwise 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 CXApp with a short position of Marketwise. Check out your portfolio center. Please also check ongoing floating volatility patterns of CXApp and Marketwise.
Diversification Opportunities for CXApp and Marketwise
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CXApp and Marketwise is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding CXApp Inc and Marketwise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marketwise and CXApp 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 CXApp Inc are associated (or correlated) with Marketwise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marketwise has no effect on the direction of CXApp i.e., CXApp and Marketwise go up and down completely randomly.
Pair Corralation between CXApp and Marketwise
Given the investment horizon of 90 days CXApp Inc is expected to generate 2.77 times more return on investment than Marketwise. However, CXApp is 2.77 times more volatile than Marketwise. It trades about 0.04 of its potential returns per unit of risk. Marketwise is currently generating about -0.04 per unit of risk. If you would invest 180.00 in CXApp Inc on August 25, 2024 and sell it today you would lose (39.00) from holding CXApp Inc or give up 21.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.66% |
| Values | Daily Returns |
CXApp Inc vs. Marketwise
Performance |
| Timeline |
| CXApp Inc |
| Marketwise |
CXApp and Marketwise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CXApp and Marketwise
The main advantage of trading using opposite CXApp and Marketwise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CXApp position performs unexpectedly, Marketwise 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 Marketwise will offset losses from the drop in Marketwise's long position.The idea behind CXApp Inc and Marketwise 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.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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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