Correlation Between Marchex and Global E
Can any of the company-specific risk be diversified away by investing in both Marchex and Global E 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 Marchex and Global E into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marchex and Global E Online, you can compare the effects of market volatilities on Marchex and Global E 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 Marchex with a short position of Global E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marchex and Global E.
Diversification Opportunities for Marchex and Global E
Very good diversification
The 3 months correlation between Marchex and Global is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Marchex and Global E Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global E Online and Marchex 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 Marchex are associated (or correlated) with Global E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global E Online has no effect on the direction of Marchex i.e., Marchex and Global E go up and down completely randomly.
Pair Corralation between Marchex and Global E
Given the investment horizon of 90 days Marchex is expected to generate 4.14 times less return on investment than Global E. In addition to that, Marchex is 1.24 times more volatile than Global E Online. It trades about 0.09 of its total potential returns per unit of risk. Global E Online is currently generating about 0.44 per unit of volatility. If you would invest 3,849 in Global E Online on August 28, 2024 and sell it today you would earn a total of 1,353 from holding Global E Online or generate 35.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marchex vs. Global E Online
Performance |
| Timeline |
| Marchex |
| Global E Online |
Marchex and Global E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marchex and Global E
The main advantage of trading using opposite Marchex and Global E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marchex position performs unexpectedly, Global E 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 Global E will offset losses from the drop in Global E's long position.| Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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