Correlation Between Appfolio and CXApp

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

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

Diversification Opportunities for Appfolio and CXApp

0.01

Correlation Coefficient

Appfolio  CXApp

Significant diversification

The 3 months correlation between Appfolio and CXApp is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Appfolio and CXApp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CXApp Inc and Appfolio 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 Appfolio are associated (or correlated) with CXApp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CXApp Inc has no effect on the direction of Appfolio i.e., Appfolio and CXApp go up and down completely randomly.

Pair Corralation between Appfolio and CXApp

Given the investment horizon of 90 days Appfolio is expected to generate 8.35 times less return on investment than CXApp. But when comparing it to its historical volatility, Appfolio is 6.86 times less risky than CXApp. It trades about 0.08 of its potential returns per unit of risk. CXApp Inc is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  3.01  in CXApp Inc on September 22, 2024 and sell it today you would earn a total of  17.99  from holding CXApp Inc or generate 597.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.59%
Values	Daily Returns

Appfolio  vs.  CXApp Inc

Appfolio

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Appfolio are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Appfolio may actually be approaching a critical reversion point that can send shares even higher in January 2025.

CXApp Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CXApp Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward indicators, CXApp is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Appfolio and CXApp

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

The idea behind Appfolio and CXApp 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.

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 the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.