Correlation Between Soluna Holdings and NextTrip
Can any of the company-specific risk be diversified away by investing in both Soluna Holdings and NextTrip 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 Soluna Holdings and NextTrip into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Soluna Holdings and NextTrip, you can compare the effects of market volatilities on Soluna Holdings and NextTrip 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 Soluna Holdings with a short position of NextTrip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Soluna Holdings and NextTrip.
Diversification Opportunities for Soluna Holdings and NextTrip
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Soluna and NextTrip is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Soluna Holdings and NextTrip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextTrip and Soluna Holdings 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 Soluna Holdings are associated (or correlated) with NextTrip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextTrip has no effect on the direction of Soluna Holdings i.e., Soluna Holdings and NextTrip go up and down completely randomly.
Pair Corralation between Soluna Holdings and NextTrip
Given the investment horizon of 90 days Soluna Holdings is expected to generate 1.58 times less return on investment than NextTrip. But when comparing it to its historical volatility, Soluna Holdings is 1.23 times less risky than NextTrip. It trades about 0.02 of its potential returns per unit of risk. NextTrip is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 910.00 in NextTrip on September 12, 2024 and sell it today you would lose (505.10) from holding NextTrip or give up 55.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Soluna Holdings vs. NextTrip
Performance |
| Timeline |
| Soluna Holdings |
| NextTrip |
Soluna Holdings and NextTrip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Soluna Holdings and NextTrip
The main advantage of trading using opposite Soluna Holdings and NextTrip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Soluna Holdings position performs unexpectedly, NextTrip 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 NextTrip will offset losses from the drop in NextTrip's long position.| Soluna Holdings vs. CLPS Inc | Soluna Holdings vs. Xalles Holdings | Soluna Holdings vs. SEATech Ventures Corp | Soluna Holdings vs. ASGN Inc |
| NextTrip vs. Cadence Design Systems | NextTrip vs. Sapiens International | NextTrip vs. FiscalNote Holdings | NextTrip vs. NI Holdings |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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