Correlation Between Genworth Financial and Ideanomics

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Can any of the company-specific risk be diversified away by investing in both Genworth Financial and Ideanomics 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 Genworth Financial and Ideanomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genworth Financial and Ideanomics, you can compare the effects of market volatilities on Genworth Financial and Ideanomics 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 Genworth Financial with a short position of Ideanomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genworth Financial and Ideanomics.

Diversification Opportunities for Genworth Financial and Ideanomics

0.45
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Genworth and Ideanomics is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Genworth Financial and Ideanomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ideanomics and Genworth Financial 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 Genworth Financial are associated (or correlated) with Ideanomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ideanomics has no effect on the direction of Genworth Financial i.e., Genworth Financial and Ideanomics go up and down completely randomly.

Pair Corralation between Genworth Financial and Ideanomics

Considering the 90-day investment horizon Genworth Financial is expected to generate 0.44 times more return on investment than Ideanomics. However, Genworth Financial is 2.25 times less risky than Ideanomics. It trades about -0.21 of its potential returns per unit of risk. Ideanomics is currently generating about -0.48 per unit of risk. If you would invest  419.00  in Genworth Financial on July 5, 2022 and sell it today you would lose (69.00)  from holding Genworth Financial or give up 16.47% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Genworth Financial  vs.  Ideanomics

 Performance (%) 
       Timeline  
Genworth Financial 
Genworth Performance
0 of 100
Over the last 90 days Genworth Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Genworth Financial is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Genworth Price Channel

Ideanomics 
Ideanomics Performance
0 of 100
Over the last 90 days Ideanomics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in November 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Ideanomics Price Channel

Genworth Financial and Ideanomics Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Genworth Financial and Ideanomics

The main advantage of trading using opposite Genworth Financial and Ideanomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genworth Financial position performs unexpectedly, Ideanomics 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 Ideanomics will offset losses from the drop in Ideanomics' long position.
Genworth Financial vs. Amazon Inc
The idea behind Genworth Financial and Ideanomics 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.
Ideanomics vs. Amazon Inc
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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