Correlation Between SoFi Technologies and Skillz Platform
Can any of the company-specific risk be diversified away by investing in both SoFi Technologies and Skillz Platform 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 SoFi Technologies and Skillz Platform into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoFi Technologies and Skillz Platform, you can compare the effects of market volatilities on SoFi Technologies and Skillz Platform 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 SoFi Technologies with a short position of Skillz Platform. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoFi Technologies and Skillz Platform.
Diversification Opportunities for SoFi Technologies and Skillz Platform
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SoFi and Skillz is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Technologies and Skillz Platform in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skillz Platform and SoFi Technologies 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 SoFi Technologies are associated (or correlated) with Skillz Platform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skillz Platform has no effect on the direction of SoFi Technologies i.e., SoFi Technologies and Skillz Platform go up and down completely randomly.
Pair Corralation between SoFi Technologies and Skillz Platform
Given the investment horizon of 90 days SoFi Technologies is expected to generate 1.17 times more return on investment than Skillz Platform. However, SoFi Technologies is 1.17 times more volatile than Skillz Platform. It trades about 0.13 of its potential returns per unit of risk. Skillz Platform is currently generating about -0.12 per unit of risk. If you would invest 645.00 in SoFi Technologies on June 25, 2024 and sell it today you would earn a total of 160.00 from holding SoFi Technologies or generate 24.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SoFi Technologies vs. Skillz Platform
Performance |
Timeline |
SoFi Technologies |
Skillz Platform |
SoFi Technologies and Skillz Platform Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SoFi Technologies and Skillz Platform
The main advantage of trading using opposite SoFi Technologies and Skillz Platform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoFi Technologies position performs unexpectedly, Skillz Platform 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 Skillz Platform will offset losses from the drop in Skillz Platform's long position.SoFi Technologies vs. Visa Class A | SoFi Technologies vs. Mastercard | SoFi Technologies vs. Aquagold International | SoFi Technologies vs. Thrivent High Yield |
Skillz Platform vs. Bilibili | Skillz Platform vs. Take Two Interactive Software | Skillz Platform vs. NetEase | Skillz Platform vs. Roblox Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |