Correlation Between Salient Alternative and Veea
Can any of the company-specific risk be diversified away by investing in both Salient Alternative and Veea 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 Salient Alternative and Veea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salient Alternative Beta and Veea Inc, you can compare the effects of market volatilities on Salient Alternative and Veea 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 Salient Alternative with a short position of Veea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salient Alternative and Veea.
Diversification Opportunities for Salient Alternative and Veea
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Salient and Veea is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Salient Alternative Beta and Veea Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veea Inc and Salient Alternative 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 Salient Alternative Beta are associated (or correlated) with Veea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veea Inc has no effect on the direction of Salient Alternative i.e., Salient Alternative and Veea go up and down completely randomly.
Pair Corralation between Salient Alternative and Veea
Assuming the 90 days horizon Salient Alternative Beta is expected to generate 0.13 times more return on investment than Veea. However, Salient Alternative Beta is 7.71 times less risky than Veea. It trades about 0.29 of its potential returns per unit of risk. Veea Inc is currently generating about -0.22 per unit of risk. If you would invest 1,181 in Salient Alternative Beta on September 3, 2024 and sell it today you would earn a total of 47.00 from holding Salient Alternative Beta or generate 3.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salient Alternative Beta vs. Veea Inc
Performance |
| Timeline |
| Salient Alternative Beta |
| Veea Inc |
Salient Alternative and Veea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salient Alternative and Veea
The main advantage of trading using opposite Salient Alternative and Veea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salient Alternative position performs unexpectedly, Veea 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 Veea will offset losses from the drop in Veea's long position.The idea behind Salient Alternative Beta and Veea Inc 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.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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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