Correlation Between Roundhill Investments and YieldMax ABNB

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

By analyzing existing cross correlation between Roundhill Investments and YieldMax ABNB Option, you can compare the effects of market volatilities on Roundhill Investments and YieldMax ABNB 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 YieldMax ABNB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roundhill Investments and YieldMax ABNB.

Diversification Opportunities for Roundhill Investments and YieldMax ABNB

0.74

Correlation Coefficient

Roundhill Investments  YieldMax ABNB

Poor diversification

The 3 months correlation between Roundhill and YieldMax is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Roundhill Investments and YieldMax ABNB Option in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax ABNB Option 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 YieldMax ABNB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax ABNB Option has no effect on the direction of Roundhill Investments i.e., Roundhill Investments and YieldMax ABNB go up and down completely randomly.

Pair Corralation between Roundhill Investments and YieldMax ABNB

If you would invest  1,572  in YieldMax ABNB Option on September 4, 2024 and sell it today you would earn a total of  12.00  from holding YieldMax ABNB Option or generate 0.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	4.76%
Values	Daily Returns

Roundhill Investments  vs.  YieldMax ABNB Option

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 primary indicators, Roundhill Investments is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

YieldMax ABNB Option

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in YieldMax ABNB Option are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, YieldMax ABNB may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Roundhill Investments and YieldMax ABNB

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

The idea behind Roundhill Investments and YieldMax ABNB Option 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..