Correlation Between Upstart Holdings and Shopify
Can any of the company-specific risk be diversified away by investing in both Upstart Holdings and Shopify 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 Upstart Holdings and Shopify into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Upstart Holdings and Shopify, you can compare the effects of market volatilities on Upstart Holdings and Shopify 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 Upstart Holdings with a short position of Shopify. Check out your portfolio center. Please also check ongoing floating volatility patterns of Upstart Holdings and Shopify.
Diversification Opportunities for Upstart Holdings and Shopify
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Upstart and Shopify is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Upstart Holdings and Shopify in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shopify and Upstart Holdings 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 Upstart Holdings are associated (or correlated) with Shopify. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shopify has no effect on the direction of Upstart Holdings i.e., Upstart Holdings and Shopify go up and down completely randomly.
Pair Corralation between Upstart Holdings and Shopify
Given the investment horizon of 90 days Upstart Holdings is expected to generate 1.16 times less return on investment than Shopify. In addition to that, Upstart Holdings is 1.22 times more volatile than Shopify. It trades about 0.05 of its total potential returns per unit of risk. Shopify is currently generating about 0.07 per unit of volatility. If you would invest 10,658 in Shopify on May 30, 2025 and sell it today you would earn a total of 3,611 from holding Shopify or generate 33.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Upstart Holdings vs. Shopify
Performance |
| Timeline |
| Upstart Holdings |
| Shopify |
Upstart Holdings and Shopify Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Upstart Holdings and Shopify
The main advantage of trading using opposite Upstart Holdings and Shopify positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Upstart Holdings position performs unexpectedly, Shopify 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 Shopify will offset losses from the drop in Shopify's long position.| Upstart Holdings vs. Wells Fargo | Upstart Holdings vs. Morningstar Unconstrained Allocation | Upstart Holdings vs. Thrivent High Yield | Upstart Holdings vs. Via Renewables |
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.
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