Correlation Between Robinhood Markets and Value Exchange

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

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

Diversification Opportunities for Robinhood Markets and Value Exchange

0.38

Correlation Coefficient

Robinhood Markets  Value Exchange

Weak diversification

The 3 months correlation between Robinhood and Value is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Robinhood Markets and Value Exchange International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Exchange Inter and Robinhood Markets 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 Robinhood Markets are associated (or correlated) with Value Exchange. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Exchange Inter has no effect on the direction of Robinhood Markets i.e., Robinhood Markets and Value Exchange go up and down completely randomly.

Pair Corralation between Robinhood Markets and Value Exchange

Given the investment horizon of 90 days Robinhood Markets is expected to generate 24.02 times less return on investment than Value Exchange. But when comparing it to its historical volatility, Robinhood Markets is 11.34 times less risky than Value Exchange. It trades about 0.04 of its potential returns per unit of risk. Value Exchange International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1.01  in Value Exchange International on September 13, 2025 and sell it today you would lose (0.96) from holding Value Exchange International or give up 95.05% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Robinhood Markets  vs.  Value Exchange International

Robinhood Markets

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Robinhood Markets are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Robinhood Markets may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Value Exchange Inter

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Value Exchange International are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Value Exchange demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Robinhood Markets and Value Exchange

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

The idea behind Robinhood Markets and Value Exchange International 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.