Correlation Between XCAD Network and TMTG

Can any of the company-specific risk be diversified away by investing in both XCAD Network and TMTG 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 XCAD Network and TMTG into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between XCAD Network and TMTG, you can compare the effects of market volatilities on XCAD Network and TMTG 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 XCAD Network with a short position of TMTG. Check out your portfolio center. Please also check ongoing floating volatility patterns of XCAD Network and TMTG.

Diversification Opportunities for XCAD Network and TMTG

0.0

Correlation Coefficient

XCAD Network  TMTG

Pay attention - limited upside

The 3 months correlation between XCAD and TMTG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding XCAD Network and TMTG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TMTG and XCAD Network 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 XCAD Network are associated (or correlated) with TMTG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TMTG has no effect on the direction of XCAD Network i.e., XCAD Network and TMTG go up and down completely randomly.

Pair Corralation between XCAD Network and TMTG

Assuming the 90 days trading horizon XCAD Network is expected to generate 7.25 times more return on investment than TMTG. However, XCAD Network is 7.25 times more volatile than TMTG. It trades about 0.04 of its potential returns per unit of risk. TMTG is currently generating about 0.01 per unit of risk. If you would invest  0.00  in XCAD Network on January 31, 2024 and sell it today you would earn a total of  83.00  from holding XCAD Network or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	70.18%
Values	Daily Returns

XCAD Network  vs.  TMTG

XCAD Network

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days XCAD Network has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, XCAD Network is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

TMTG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TMTG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, TMTG is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with XCAD Network and TMTG

The main advantage of trading using opposite XCAD Network and TMTG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XCAD Network position performs unexpectedly, TMTG 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 TMTG will offset losses from the drop in TMTG's long position.

The idea behind XCAD Network and TMTG 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.

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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.