Correlation Between Red Cat and Strong Global
Can any of the company-specific risk be diversified away by investing in both Red Cat and Strong Global 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 Red Cat and Strong Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Cat Holdings and Strong Global Entertainment,, you can compare the effects of market volatilities on Red Cat and Strong Global 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 Red Cat with a short position of Strong Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Cat and Strong Global.
Diversification Opportunities for Red Cat and Strong Global
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Red and Strong is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Red Cat Holdings and Strong Global Entertainment, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strong Global Entert and Red Cat 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 Red Cat Holdings are associated (or correlated) with Strong Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strong Global Entert has no effect on the direction of Red Cat i.e., Red Cat and Strong Global go up and down completely randomly.
Pair Corralation between Red Cat and Strong Global
If you would invest 269.00 in Red Cat Holdings on August 26, 2024 and sell it today you would earn a total of 628.00 from holding Red Cat Holdings or generate 233.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Red Cat Holdings vs. Strong Global Entertainment,
Performance |
| Timeline |
| Red Cat Holdings |
| Strong Global Entert |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Red Cat and Strong Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Cat and Strong Global
The main advantage of trading using opposite Red Cat and Strong Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Cat position performs unexpectedly, Strong Global 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 Strong Global will offset losses from the drop in Strong Global's long position.| Red Cat vs. Quantum Computing | Red Cat vs. Rigetti Computing | Red Cat vs. D Wave Quantum | Red Cat vs. AstroNova |
| Strong Global vs. PGE Corp | Strong Global vs. Naked Wines plc | Strong Global vs. Willamette Valley Vineyards | Strong Global vs. Constellation Brands 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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