Correlation Between Fiverr International and Nextdoor Holdings
Can any of the company-specific risk be diversified away by investing in both Fiverr International and Nextdoor 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 Fiverr International and Nextdoor Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fiverr International and Nextdoor Holdings, you can compare the effects of market volatilities on Fiverr International and Nextdoor 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 Fiverr International with a short position of Nextdoor Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiverr International and Nextdoor Holdings.
Diversification Opportunities for Fiverr International and Nextdoor Holdings
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fiverr and Nextdoor is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Fiverr International and Nextdoor Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextdoor Holdings and Fiverr International 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 Fiverr International are associated (or correlated) with Nextdoor Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextdoor Holdings has no effect on the direction of Fiverr International i.e., Fiverr International and Nextdoor Holdings go up and down completely randomly.
Pair Corralation between Fiverr International and Nextdoor Holdings
Given the investment horizon of 90 days Fiverr International is expected to generate 1.44 times less return on investment than Nextdoor Holdings. In addition to that, Fiverr International is 1.1 times more volatile than Nextdoor Holdings. It trades about 0.02 of its total potential returns per unit of risk. Nextdoor Holdings is currently generating about 0.03 per unit of volatility. If you would invest 202.00 in Nextdoor Holdings on August 27, 2024 and sell it today you would earn a total of 55.00 from holding Nextdoor Holdings or generate 27.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fiverr International vs. Nextdoor Holdings
Performance |
| Timeline |
| Fiverr International |
| Nextdoor Holdings |
Fiverr International and Nextdoor Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fiverr International and Nextdoor Holdings
The main advantage of trading using opposite Fiverr International and Nextdoor Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fiverr International position performs unexpectedly, Nextdoor 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 Nextdoor Holdings will offset losses from the drop in Nextdoor Holdings' long position.| Fiverr International vs. Snap Inc | Fiverr International vs. Twilio Inc | Fiverr International vs. Spotify Technology SA | Fiverr International vs. Baidu Inc |
| Nextdoor Holdings vs. IAC Inc | Nextdoor Holdings vs. Yelp Inc | Nextdoor Holdings vs. Groupon | Nextdoor Holdings vs. Outbrain |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |