Correlation Between Roundhill Investments and Tuttle Capital

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

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

Diversification Opportunities for Roundhill Investments and Tuttle Capital

0.37

Correlation Coefficient

Roundhill Investments  Tuttle Capital

Weak diversification

The 3 months correlation between Roundhill and Tuttle is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Roundhill Investments and Tuttle Capital Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tuttle Capital Short and Roundhill Investments 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 Roundhill Investments are associated (or correlated) with Tuttle Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tuttle Capital Short has no effect on the direction of Roundhill Investments i.e., Roundhill Investments and Tuttle Capital go up and down completely randomly.

Pair Corralation between Roundhill Investments and Tuttle Capital

If you would invest  2,822  in Tuttle Capital Short on September 16, 2024 and sell it today you would earn a total of  1,486  from holding Tuttle Capital Short or generate 52.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.54%
Values	Daily Returns

Roundhill Investments  vs.  Tuttle Capital Short

Roundhill Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Roundhill Investments has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Roundhill Investments is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Tuttle Capital Short

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Tuttle Capital Short are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating basic indicators, Tuttle Capital disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Roundhill Investments and Tuttle Capital

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

The idea behind Roundhill Investments and Tuttle Capital Short 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.