Correlation Between Locafy and Onfolio Holdings
Can any of the company-specific risk be diversified away by investing in both Locafy and Onfolio 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 Locafy and Onfolio Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Locafy and Onfolio Holdings, you can compare the effects of market volatilities on Locafy and Onfolio 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 Locafy with a short position of Onfolio Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Locafy and Onfolio Holdings.
Diversification Opportunities for Locafy and Onfolio Holdings
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Locafy and Onfolio is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Locafy and Onfolio Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onfolio Holdings and Locafy 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 Locafy are associated (or correlated) with Onfolio Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onfolio Holdings has no effect on the direction of Locafy i.e., Locafy and Onfolio Holdings go up and down completely randomly.
Pair Corralation between Locafy and Onfolio Holdings
Given the investment horizon of 90 days Locafy is expected to generate 1.44 times more return on investment than Onfolio Holdings. However, Locafy is 1.44 times more volatile than Onfolio Holdings. It trades about 0.03 of its potential returns per unit of risk. Onfolio Holdings is currently generating about 0.03 per unit of risk. If you would invest 736.00 in Locafy on August 27, 2024 and sell it today you would lose (50.00) from holding Locafy or give up 6.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Locafy vs. Onfolio Holdings
Performance |
| Timeline |
| Locafy |
| Onfolio Holdings |
Locafy and Onfolio Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Locafy and Onfolio Holdings
The main advantage of trading using opposite Locafy and Onfolio Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Locafy position performs unexpectedly, Onfolio 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 Onfolio Holdings will offset losses from the drop in Onfolio Holdings' long position.| Locafy vs. Metalpha Technology Holding | Locafy vs. 36Kr Holdings | Locafy vs. TuanChe ADR | Locafy vs. Quizam Media |
| Onfolio Holdings vs. Trivago NV | Onfolio Holdings vs. Cheetah Mobile | Onfolio Holdings vs. Comscore | Onfolio Holdings vs. Arena Group Holdings |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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