Correlation Between Meten EdtechX and Lion Financial
Can any of the company-specific risk be diversified away by investing in both Meten EdtechX and Lion Financial 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 Meten EdtechX and Lion Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meten EdtechX Education and Lion Financial Group, you can compare the effects of market volatilities on Meten EdtechX and Lion Financial 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 Meten EdtechX with a short position of Lion Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meten EdtechX and Lion Financial.
Diversification Opportunities for Meten EdtechX and Lion Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Meten and Lion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Meten EdtechX Education and Lion Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Financial Group and Meten EdtechX 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 Meten EdtechX Education are associated (or correlated) with Lion Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Financial Group has no effect on the direction of Meten EdtechX i.e., Meten EdtechX and Lion Financial go up and down completely randomly.
Pair Corralation between Meten EdtechX and Lion Financial
If you would invest 0.39 in Lion Financial Group on September 3, 2024 and sell it today you would earn a total of 0.46 from holding Lion Financial Group or generate 117.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Meten EdtechX Education vs. Lion Financial Group
Performance |
| Timeline |
| Meten EdtechX Education |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lion Financial Group |
Meten EdtechX and Lion Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meten EdtechX and Lion Financial
The main advantage of trading using opposite Meten EdtechX and Lion Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meten EdtechX position performs unexpectedly, Lion Financial 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 Lion Financial will offset losses from the drop in Lion Financial's long position.The idea behind Meten EdtechX Education and Lion Financial Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Lion Financial vs. Riot Blockchain | Lion Financial vs. Marathon Digital Holdings | Lion Financial vs. Applied Blockchain | Lion Financial vs. Hut 8 Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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