Correlation Between ToughBuilt Industries and Phunware

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

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

Diversification Opportunities for ToughBuilt Industries and Phunware

0.0

Correlation Coefficient

ToughBuilt Industries  Phunware

Pay attention - limited upside

The 3 months correlation between ToughBuilt and Phunware is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ToughBuilt Industries WT and Phunware in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phunware and ToughBuilt Industries 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 ToughBuilt Industries WT are associated (or correlated) with Phunware. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phunware has no effect on the direction of ToughBuilt Industries i.e., ToughBuilt Industries and Phunware go up and down completely randomly.

Pair Corralation between ToughBuilt Industries and Phunware

If you would invest (100.00) in Phunware on January 7, 2025 and sell it today you would earn a total of  100.00  from holding Phunware or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ToughBuilt Industries WT  vs.  Phunware

ToughBuilt Industries

Risk-Adjusted Performance

Very Weak

Over the last 90 days ToughBuilt Industries WT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, ToughBuilt Industries is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Phunware

Risk-Adjusted Performance

Very Weak

Over the last 90 days Phunware has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Phunware is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with ToughBuilt Industries and Phunware

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

The idea behind ToughBuilt Industries WT and Phunware 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 Global Correlations module to find global opportunities by holding instruments from different markets.