Correlation Between Soluna Holdings and Perficient

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

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

Diversification Opportunities for Soluna Holdings and Perficient

0.04

Correlation Coefficient

Soluna Holdings  Perficient

Significant diversification

The 3 months correlation between Soluna and Perficient is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Soluna Holdings and Perficient in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perficient and Soluna 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 Soluna Holdings are associated (or correlated) with Perficient. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perficient has no effect on the direction of Soluna Holdings i.e., Soluna Holdings and Perficient go up and down completely randomly.

Pair Corralation between Soluna Holdings and Perficient

Given the investment horizon of 90 days Soluna Holdings is expected to generate 40.27 times more return on investment than Perficient. However, Soluna Holdings is 40.27 times more volatile than Perficient. It trades about 0.04 of its potential returns per unit of risk. Perficient is currently generating about 0.25 per unit of risk. If you would invest  341.00  in Soluna Holdings on September 1, 2024 and sell it today you would earn a total of  1.00  from holding Soluna Holdings or generate 0.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	34.92%
Values	Daily Returns

Soluna Holdings  vs.  Perficient

Soluna Holdings

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Soluna Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Soluna Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Perficient

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days Perficient has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Perficient is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Soluna Holdings and Perficient

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

The idea behind Soluna Holdings and Perficient 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.