Correlation Between Five9 and Alfi
Can any of the company-specific risk be diversified away by investing in both Five9 and Alfi 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 Five9 and Alfi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Five9 Inc and Alfi Inc, you can compare the effects of market volatilities on Five9 and Alfi 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 Five9 with a short position of Alfi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Five9 and Alfi.
Diversification Opportunities for Five9 and Alfi
Excellent diversification
The 3 months correlation between Five9 and Alfi is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Five9 Inc and Alfi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfi Inc and Five9 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 Five9 Inc are associated (or correlated) with Alfi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfi Inc has no effect on the direction of Five9 i.e., Five9 and Alfi go up and down completely randomly.
Pair Corralation between Five9 and Alfi
If you would invest 2,955 in Five9 Inc on August 26, 2024 and sell it today you would earn a total of 1,077 from holding Five9 Inc or generate 36.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Five9 Inc vs. Alfi Inc
Performance |
| Timeline |
| Five9 Inc |
| Alfi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Five9 and Alfi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Five9 and Alfi
The main advantage of trading using opposite Five9 and Alfi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Five9 position performs unexpectedly, Alfi 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 Alfi will offset losses from the drop in Alfi's long position.The idea behind Five9 Inc and Alfi 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.| Alfi vs. Arax Holdings Corp | Alfi vs. AppTech Payments Corp | Alfi vs. Arbe Robotics Ltd | Alfi vs. Argentum 47 |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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