Correlation Between Intuitive Machines and Three Sixty

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

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

Diversification Opportunities for Intuitive Machines and Three Sixty

-0.88

Correlation Coefficient

Intuitive Machines  Three Sixty

Pay attention - limited upside

The 3 months correlation between Intuitive and Three is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Machines and Three Sixty Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Three Sixty Solar and Intuitive Machines 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 Intuitive Machines are associated (or correlated) with Three Sixty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Three Sixty Solar has no effect on the direction of Intuitive Machines i.e., Intuitive Machines and Three Sixty go up and down completely randomly.

Pair Corralation between Intuitive Machines and Three Sixty

Given the investment horizon of 90 days Intuitive Machines is expected to generate 7.05 times less return on investment than Three Sixty. But when comparing it to its historical volatility, Intuitive Machines is 14.39 times less risky than Three Sixty. It trades about 0.17 of its potential returns per unit of risk. Three Sixty Solar is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  3.89  in Three Sixty Solar on September 15, 2024 and sell it today you would lose (3.88) from holding Three Sixty Solar or give up 99.74% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Intuitive Machines  vs.  Three Sixty Solar

Intuitive Machines

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Machines are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Intuitive Machines reported solid returns over the last few months and may actually be approaching a breakup point.

Three Sixty Solar

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Three Sixty Solar are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, Three Sixty reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intuitive Machines and Three Sixty

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

The idea behind Intuitive Machines and Three Sixty Solar 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.