Correlation Between Friendable and Life360, Common

Can any of the company-specific risk be diversified away by investing in both Friendable and Life360, Common 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 Friendable and Life360, Common into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Friendable and Life360, Common Stock, you can compare the effects of market volatilities on Friendable and Life360, Common 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 Friendable with a short position of Life360, Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Friendable and Life360, Common.

Diversification Opportunities for Friendable and Life360, Common

0.18

Correlation Coefficient

Friendable  Life360, Common

Average diversification

The 3 months correlation between Friendable and Life360, is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Friendable and Life360, Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life360, Common Stock and Friendable 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 Friendable are associated (or correlated) with Life360, Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life360, Common Stock has no effect on the direction of Friendable i.e., Friendable and Life360, Common go up and down completely randomly.

Pair Corralation between Friendable and Life360, Common

Given the investment horizon of 90 days Friendable is expected to generate 24.46 times more return on investment than Life360, Common. However, Friendable is 24.46 times more volatile than Life360, Common Stock. It trades about 0.07 of its potential returns per unit of risk. Life360, Common Stock is currently generating about 0.17 per unit of risk. If you would invest  5.00  in Friendable on August 30, 2024 and sell it today you would lose (4.99) from holding Friendable or give up 99.8% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	24.85%
Values	Daily Returns

Friendable  vs.  Life360, Common Stock

Friendable

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Friendable are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, Friendable disclosed solid returns over the last few months and may actually be approaching a breakup point.

Life360, Common Stock

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Life360, Common Stock are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent forward indicators, Life360, Common reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Friendable and Life360, Common

The main advantage of trading using opposite Friendable and Life360, Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Friendable position performs unexpectedly, Life360, Common 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 Life360, Common will offset losses from the drop in Life360, Common's long position.

The idea behind Friendable and Life360, Common Stock 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.