Correlation Between Looking Glass and Smartmetric

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

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

Diversification Opportunities for Looking Glass and Smartmetric

0.44

Correlation Coefficient

Looking Glass  Smartmetric

Very weak diversification

The 3 months correlation between Looking and Smartmetric is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Looking Glass Labs and Smartmetric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartmetric and Looking Glass 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 Looking Glass Labs are associated (or correlated) with Smartmetric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartmetric has no effect on the direction of Looking Glass i.e., Looking Glass and Smartmetric go up and down completely randomly.

Pair Corralation between Looking Glass and Smartmetric

If you would invest  0.00  in Smartmetric on September 18, 2024 and sell it today you would earn a total of  0.00  from holding Smartmetric or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	5.26%
Values	Daily Returns

Looking Glass Labs  vs.  Smartmetric

Looking Glass Labs

Risk-Adjusted Performance

0 of 100

Very Weak

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

Smartmetric

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Smartmetric are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain primary indicators, Smartmetric exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Looking Glass and Smartmetric

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

The idea behind Looking Glass Labs and Smartmetric 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.