Correlation Between Chargepoint Hldgs and Big 5

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Can any of the company-specific risk be diversified away by investing in both Chargepoint Hldgs and Big 5 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 Chargepoint Hldgs and Big 5 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chargepoint Hldgs and Big 5 Sporting, you can compare the effects of market volatilities on Chargepoint Hldgs and Big 5 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 Chargepoint Hldgs with a short position of Big 5. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chargepoint Hldgs and Big 5.

Diversification Opportunities for Chargepoint Hldgs and Big 5

0.33
  Correlation Coefficient

Weak diversification

The 3 months correlation between Chargepoint and Big 5 is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Chargepoint Hldgs and Big 5 Sporting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big 5 Sporting and Chargepoint Hldgs 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 Chargepoint Hldgs are associated (or correlated) with Big 5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big 5 Sporting has no effect on the direction of Chargepoint Hldgs i.e., Chargepoint Hldgs and Big 5 go up and down completely randomly.

Pair Corralation between Chargepoint Hldgs and Big 5

Given the investment horizon of 90 days Chargepoint Hldgs is expected to generate 1.35 times less return on investment than Big 5. In addition to that, Chargepoint Hldgs is 1.12 times more volatile than Big 5 Sporting. It trades about 0.03 of its total potential returns per unit of risk. Big 5 Sporting is currently generating about 0.04 per unit of volatility. If you would invest  748.00  in Big 5 Sporting on July 2, 2022 and sell it today you would earn a total of  362.00  from holding Big 5 Sporting or generate 48.4% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Chargepoint Hldgs  vs.  Big 5 Sporting

 Performance (%) 
       Timeline  
Chargepoint Hldgs 
Chargepoint Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Chargepoint Hldgs are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Chargepoint Hldgs unveiled solid returns over the last few months and may actually be approaching a breakup point.

Chargepoint Price Channel

Big 5 Sporting 
Big 5 Performance
0 of 100
Over the last 90 days Big 5 Sporting has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Big 5 is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Big 5 Price Channel

Chargepoint Hldgs and Big 5 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Chargepoint Hldgs and Big 5

The main advantage of trading using opposite Chargepoint Hldgs and Big 5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chargepoint Hldgs position performs unexpectedly, Big 5 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 Big 5 will offset losses from the drop in Big 5's long position.
Chargepoint Hldgs vs. Best Buy Company
The idea behind Chargepoint Hldgs and Big 5 Sporting 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.
Big 5 vs. Best Buy Company
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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