Correlation Between Marchex and Aeye
Can any of the company-specific risk be diversified away by investing in both Marchex and Aeye 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 Aeye into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marchex and Aeye Inc, you can compare the effects of market volatilities on Marchex and Aeye 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 Aeye. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marchex and Aeye.
Diversification Opportunities for Marchex and Aeye
Very weak diversification
The 3 months correlation between Marchex and Aeye is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Marchex and Aeye Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeye Inc 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 Aeye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeye Inc has no effect on the direction of Marchex i.e., Marchex and Aeye go up and down completely randomly.
Pair Corralation between Marchex and Aeye
Given the investment horizon of 90 days Marchex is expected to generate 20.16 times less return on investment than Aeye. But when comparing it to its historical volatility, Marchex is 1.35 times less risky than Aeye. It trades about 0.0 of its potential returns per unit of risk. Aeye Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 107.00 in Aeye Inc on September 1, 2024 and sell it today you would earn a total of 6.00 from holding Aeye Inc or generate 5.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marchex vs. Aeye Inc
Performance |
| Timeline |
| Marchex |
| Aeye Inc |
Marchex and Aeye Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marchex and Aeye
The main advantage of trading using opposite Marchex and Aeye positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marchex position performs unexpectedly, Aeye 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 Aeye will offset losses from the drop in Aeye's long position.| Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
| Aeye vs. Innoviz Technologies | Aeye vs. Hesai Group American | Aeye vs. Luminar Technologies | Aeye vs. Mobileye Global Class |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |