Correlation Between Tenet Fintech and Alfi

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

By analyzing existing cross correlation between Tenet Fintech Group and Alfi Inc, you can compare the effects of market volatilities on Tenet Fintech and Alfi 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 Tenet Fintech with a short position of Alfi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tenet Fintech and Alfi.

Diversification Opportunities for Tenet Fintech and Alfi

0.07

Correlation Coefficient

Tenet Fintech  Alfi

Significant diversification

The 3 months correlation between Tenet and Alfi is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Tenet Fintech Group and Alfi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfi Inc and Tenet Fintech 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 Tenet Fintech Group are associated (or correlated) with Alfi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfi Inc has no effect on the direction of Tenet Fintech i.e., Tenet Fintech and Alfi go up and down completely randomly.

Pair Corralation between Tenet Fintech and Alfi

If you would invest  0.90  in Alfi Inc on September 23, 2024 and sell it today you would earn a total of  0.00  from holding Alfi Inc or generate 0.0% return on investment over 90 days.

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

Tenet Fintech Group  vs.  Alfi Inc

Tenet Fintech Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tenet Fintech Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal technical and fundamental indicators, Tenet Fintech reported solid returns over the last few months and may actually be approaching a breakup point.

Alfi Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alfi Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Alfi is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Tenet Fintech and Alfi

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

The idea behind Tenet Fintech Group and Alfi Inc 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.