Correlation Between MoneyLion and Daily Journal

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

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

Diversification Opportunities for MoneyLion and Daily Journal

0.94

Correlation Coefficient

MoneyLion  Daily Journal

Almost no diversification

The 3 months correlation between MoneyLion and Daily is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding MoneyLion and Daily Journal Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daily Journal Corp and MoneyLion 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 MoneyLion are associated (or correlated) with Daily Journal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daily Journal Corp has no effect on the direction of MoneyLion i.e., MoneyLion and Daily Journal go up and down completely randomly.

Pair Corralation between MoneyLion and Daily Journal

Allowing for the 90-day total investment horizon MoneyLion is expected to generate 2.36 times more return on investment than Daily Journal. However, MoneyLion is 2.36 times more volatile than Daily Journal Corp. It trades about 0.01 of its potential returns per unit of risk. Daily Journal Corp is currently generating about -0.06 per unit of risk. If you would invest  8,665  in MoneyLion on September 25, 2024 and sell it today you would lose (60.00) from holding MoneyLion or give up 0.69% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

MoneyLion  vs.  Daily Journal Corp

MoneyLion

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in MoneyLion are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent essential indicators, MoneyLion disclosed solid returns over the last few months and may actually be approaching a breakup point.

Daily Journal Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Daily Journal Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Daily Journal displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MoneyLion and Daily Journal

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

The idea behind MoneyLion and Daily Journal Corp 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.