Correlation Between Farmers Edge and Auddia
Can any of the company-specific risk be diversified away by investing in both Farmers Edge and Auddia 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 Farmers Edge and Auddia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Farmers Edge and Auddia Inc, you can compare the effects of market volatilities on Farmers Edge and Auddia 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 Farmers Edge with a short position of Auddia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Farmers Edge and Auddia.
Diversification Opportunities for Farmers Edge and Auddia
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Farmers and Auddia is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Farmers Edge and Auddia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auddia Inc and Farmers Edge 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 Farmers Edge are associated (or correlated) with Auddia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auddia Inc has no effect on the direction of Farmers Edge i.e., Farmers Edge and Auddia go up and down completely randomly.
Pair Corralation between Farmers Edge and Auddia
If you would invest 3.00 in Auddia Inc on August 29, 2024 and sell it today you would lose (0.26) from holding Auddia Inc or give up 8.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 7.69% |
| Values | Daily Returns |
Farmers Edge vs. Auddia Inc
Performance |
| Timeline |
| Farmers Edge |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Auddia Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Farmers Edge and Auddia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Farmers Edge and Auddia
The main advantage of trading using opposite Farmers Edge and Auddia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Farmers Edge position performs unexpectedly, Auddia 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 Auddia will offset losses from the drop in Auddia's long position.| Farmers Edge vs. RenoWorks Software | Farmers Edge vs. 01 Communique Laboratory | Farmers Edge vs. RESAAS Services | Farmers Edge vs. LifeSpeak |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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