Correlation Between Fluent and ZW Data
Can any of the company-specific risk be diversified away by investing in both Fluent and ZW Data 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 Fluent and ZW Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fluent Inc and ZW Data Action, you can compare the effects of market volatilities on Fluent and ZW Data 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 Fluent with a short position of ZW Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fluent and ZW Data.
Diversification Opportunities for Fluent and ZW Data
Poor diversification
The 3 months correlation between Fluent and CNET is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Fluent Inc and ZW Data Action in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZW Data Action and Fluent 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 Fluent Inc are associated (or correlated) with ZW Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZW Data Action has no effect on the direction of Fluent i.e., Fluent and ZW Data go up and down completely randomly.
Pair Corralation between Fluent and ZW Data
Given the investment horizon of 90 days Fluent Inc is expected to under-perform the ZW Data. But the stock apears to be less risky and, when comparing its historical volatility, Fluent Inc is 1.58 times less risky than ZW Data. The stock trades about -0.01 of its potential returns per unit of risk. The ZW Data Action is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 159.00 in ZW Data Action on April 23, 2025 and sell it today you would earn a total of 4.00 from holding ZW Data Action or generate 2.52% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Fluent Inc vs. ZW Data Action
Performance |
Timeline |
Fluent Inc |
ZW Data Action |
Fluent and ZW Data Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fluent and ZW Data
The main advantage of trading using opposite Fluent and ZW Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fluent position performs unexpectedly, ZW Data 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 ZW Data will offset losses from the drop in ZW Data's long position.The idea behind Fluent Inc and ZW Data Action 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.ZW Data vs. Baosheng Media Group | ZW Data vs. Lendway | ZW Data vs. Abits Group | ZW Data vs. Impact Fusion International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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