Correlation Between Eightco Holdings and WestRock

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

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

Diversification Opportunities for Eightco Holdings and WestRock

-0.29

Correlation Coefficient

Eightco Holdings  WestRock

Very good diversification

The 3 months correlation between Eightco and WestRock is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Eightco Holdings and WestRock Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WestRock and Eightco Holdings 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 Eightco Holdings are associated (or correlated) with WestRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WestRock has no effect on the direction of Eightco Holdings i.e., Eightco Holdings and WestRock go up and down completely randomly.

Pair Corralation between Eightco Holdings and WestRock

If you would invest  164.00  in Eightco Holdings on September 14, 2024 and sell it today you would lose (5.00) from holding Eightco Holdings or give up 3.05% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Eightco Holdings  vs.  WestRock Co

Eightco Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eightco Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Eightco Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

WestRock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WestRock Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, WestRock is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Eightco Holdings and WestRock

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

The idea behind Eightco Holdings and WestRock Co 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.