Correlation Between WeCommerce Holdings and Snowflake

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

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

Diversification Opportunities for WeCommerce Holdings and Snowflake

0.04

Correlation Coefficient

WeCommerce Holdings  Snowflake

Significant diversification

The 3 months correlation between WeCommerce and Snowflake is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding WeCommerce Holdings and Snowflake in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Snowflake and WeCommerce Holdings 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 WeCommerce Holdings are associated (or correlated) with Snowflake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Snowflake has no effect on the direction of WeCommerce Holdings i.e., WeCommerce Holdings and Snowflake go up and down completely randomly.

Pair Corralation between WeCommerce Holdings and Snowflake

If you would invest  15,343  in Snowflake on January 17, 2024 and sell it today you would lose (145.00) from holding Snowflake or give up 0.95% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	0.81%
Values	Daily Returns

WeCommerce Holdings  vs.  Snowflake

WeCommerce Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WeCommerce Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, WeCommerce Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Snowflake

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Snowflake has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in May 2024. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with WeCommerce Holdings and Snowflake

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

The idea behind WeCommerce Holdings and Snowflake 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.