Correlation Between VCI Global and Affirm Holdings
Can any of the company-specific risk be diversified away by investing in both VCI Global and Affirm Holdings 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 VCI Global and Affirm Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VCI Global Limited and Affirm Holdings, you can compare the effects of market volatilities on VCI Global and Affirm Holdings 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 VCI Global with a short position of Affirm Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of VCI Global and Affirm Holdings.
Diversification Opportunities for VCI Global and Affirm Holdings
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between VCI and Affirm is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding VCI Global Limited and Affirm Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affirm Holdings and VCI Global 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 VCI Global Limited are associated (or correlated) with Affirm Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affirm Holdings has no effect on the direction of VCI Global i.e., VCI Global and Affirm Holdings go up and down completely randomly.
Pair Corralation between VCI Global and Affirm Holdings
Given the investment horizon of 90 days VCI Global Limited is expected to under-perform the Affirm Holdings. In addition to that, VCI Global is 1.87 times more volatile than Affirm Holdings. It trades about -0.26 of its total potential returns per unit of risk. Affirm Holdings is currently generating about 0.23 per unit of volatility. If you would invest 4,082 in Affirm Holdings on August 30, 2024 and sell it today you would earn a total of 2,545 from holding Affirm Holdings or generate 62.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VCI Global Limited vs. Affirm Holdings
Performance |
| Timeline |
| VCI Global Limited |
| Affirm Holdings |
VCI Global and Affirm Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VCI Global and Affirm Holdings
The main advantage of trading using opposite VCI Global and Affirm Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VCI Global position performs unexpectedly, Affirm Holdings 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 Affirm Holdings will offset losses from the drop in Affirm Holdings' long position.| VCI Global vs. CRA International | VCI Global vs. ICF International | VCI Global vs. Forrester Research | VCI Global vs. Huron Consulting Group |
| Affirm Holdings vs. Oneconnect Financial Technology | Affirm Holdings vs. Global Business Travel | Affirm Holdings vs. Alight Inc | Affirm Holdings vs. CS Disco LLC |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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