Correlation Between Shift4 Payments and Upwork
Can any of the company-specific risk be diversified away by investing in both Shift4 Payments and Upwork 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 Shift4 Payments and Upwork into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shift4 Payments and Upwork Inc, you can compare the effects of market volatilities on Shift4 Payments and Upwork 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 Shift4 Payments with a short position of Upwork. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shift4 Payments and Upwork.
Diversification Opportunities for Shift4 Payments and Upwork
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shift4 and Upwork is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Shift4 Payments and Upwork Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upwork Inc and Shift4 Payments 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 Shift4 Payments are associated (or correlated) with Upwork. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upwork Inc has no effect on the direction of Shift4 Payments i.e., Shift4 Payments and Upwork go up and down completely randomly.
Pair Corralation between Shift4 Payments and Upwork
Given the investment horizon of 90 days Shift4 Payments is expected to generate 0.86 times more return on investment than Upwork. However, Shift4 Payments is 1.16 times less risky than Upwork. It trades about 0.1 of its potential returns per unit of risk. Upwork Inc is currently generating about 0.05 per unit of risk. If you would invest 5,451 in Shift4 Payments on August 25, 2024 and sell it today you would earn a total of 5,527 from holding Shift4 Payments or generate 101.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shift4 Payments vs. Upwork Inc
Performance |
| Timeline |
| Shift4 Payments |
| Upwork Inc |
Shift4 Payments and Upwork Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shift4 Payments and Upwork
The main advantage of trading using opposite Shift4 Payments and Upwork positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shift4 Payments position performs unexpectedly, Upwork 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 Upwork will offset losses from the drop in Upwork's long position.| Shift4 Payments vs. SentinelOne | Shift4 Payments vs. Confluent | Shift4 Payments vs. Hashicorp | Shift4 Payments vs. MongoDB |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Directory Find actively traded commodities issued by global exchanges |