Correlation Between Expensify and Guggenheim Macro

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

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

Diversification Opportunities for Expensify and Guggenheim Macro

-0.03

Correlation Coefficient

Expensify  Guggenheim Macro

Good diversification

The 3 months correlation between Expensify and Guggenheim is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Expensify and Guggenheim Macro Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Macro Opp and Expensify 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 Expensify are associated (or correlated) with Guggenheim Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Macro Opp has no effect on the direction of Expensify i.e., Expensify and Guggenheim Macro go up and down completely randomly.

Pair Corralation between Expensify and Guggenheim Macro

Given the investment horizon of 90 days Expensify is expected to under-perform the Guggenheim Macro. In addition to that, Expensify is 32.5 times more volatile than Guggenheim Macro Opportunities. It trades about -0.01 of its total potential returns per unit of risk. Guggenheim Macro Opportunities is currently generating about -0.13 per unit of volatility. If you would invest  2,420  in Guggenheim Macro Opportunities on January 24, 2024 and sell it today you would lose (9.00) from holding Guggenheim Macro Opportunities or give up 0.37% of portfolio value over 90 days.

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

Expensify  vs.  Guggenheim Macro Opportunities

Expensify

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Expensify are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent technical and fundamental indicators, Expensify may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Guggenheim Macro Opp

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Macro Opportunities are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Guggenheim Macro is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Expensify and Guggenheim Macro

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

The idea behind Expensify and Guggenheim Macro Opportunities 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.