Correlation Between Usaa Intermediate and Veea

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

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

Diversification Opportunities for Usaa Intermediate and Veea

0.59

Correlation Coefficient

Usaa Intermediate  Veea

Very weak diversification

The 3 months correlation between Usaa and Veea is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Usaa Intermediate Term and Veea Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veea Inc and Usaa Intermediate 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 Usaa Intermediate Term are associated (or correlated) with Veea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veea Inc has no effect on the direction of Usaa Intermediate i.e., Usaa Intermediate and Veea go up and down completely randomly.

Pair Corralation between Usaa Intermediate and Veea

Assuming the 90 days horizon Usaa Intermediate Term is expected to generate 0.05 times more return on investment than Veea. However, Usaa Intermediate Term is 18.84 times less risky than Veea. It trades about 0.07 of its potential returns per unit of risk. Veea Inc is currently generating about -0.23 per unit of risk. If you would invest  914.00  in Usaa Intermediate Term on August 29, 2024 and sell it today you would earn a total of  5.00  from holding Usaa Intermediate Term or generate 0.55% return on investment over 90 days.

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

Usaa Intermediate Term  vs.  Veea Inc

Usaa Intermediate Term

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Usaa Intermediate Term has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Usaa Intermediate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Veea Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Veea Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Usaa Intermediate and Veea

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

The idea behind Usaa Intermediate Term and Veea Inc 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.