Correlation Between SmartRent and MoneyLion
Can any of the company-specific risk be diversified away by investing in both SmartRent and MoneyLion 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 SmartRent and MoneyLion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SmartRent and MoneyLion, you can compare the effects of market volatilities on SmartRent and MoneyLion 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 SmartRent with a short position of MoneyLion. Check out your portfolio center. Please also check ongoing floating volatility patterns of SmartRent and MoneyLion.
Diversification Opportunities for SmartRent and MoneyLion
Pay attention - limited upside
The 3 months correlation between SmartRent and MoneyLion is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding SmartRent and MoneyLion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MoneyLion and SmartRent 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 SmartRent are associated (or correlated) with MoneyLion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MoneyLion has no effect on the direction of SmartRent i.e., SmartRent and MoneyLion go up and down completely randomly.
Pair Corralation between SmartRent and MoneyLion
Given the investment horizon of 90 days SmartRent is expected to under-perform the MoneyLion. But the stock apears to be less risky and, when comparing its historical volatility, SmartRent is 2.41 times less risky than MoneyLion. The stock trades about -0.09 of its potential returns per unit of risk. The MoneyLion is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 4,518 in MoneyLion on August 24, 2024 and sell it today you would earn a total of 3,333 from holding MoneyLion or generate 73.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SmartRent vs. MoneyLion
Performance |
| Timeline |
| SmartRent |
| MoneyLion |
SmartRent and MoneyLion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SmartRent and MoneyLion
The main advantage of trading using opposite SmartRent and MoneyLion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SmartRent position performs unexpectedly, MoneyLion 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 MoneyLion will offset losses from the drop in MoneyLion's long position.| SmartRent vs. Enfusion | SmartRent vs. E2open Parent Holdings | SmartRent vs. Envestnet | SmartRent vs. Hitek Global Ordinary |
| MoneyLion vs. Porch Group | MoneyLion vs. Nerdy Inc | MoneyLion vs. Wag Group Co | MoneyLion vs. Dave Warrants |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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