Correlation Between REGAL ASIAN and VITEC SOFTWARE

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and VITEC SOFTWARE 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 REGAL ASIAN and VITEC SOFTWARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and VITEC SOFTWARE GROUP, you can compare the effects of market volatilities on REGAL ASIAN and VITEC SOFTWARE 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 REGAL ASIAN with a short position of VITEC SOFTWARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and VITEC SOFTWARE.

Diversification Opportunities for REGAL ASIAN and VITEC SOFTWARE

-0.69
  Correlation Coefficient

Excellent diversification

The 3 months correlation between REGAL and VITEC is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and VITEC SOFTWARE GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VITEC SOFTWARE GROUP and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with VITEC SOFTWARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VITEC SOFTWARE GROUP has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and VITEC SOFTWARE go up and down completely randomly.

Pair Corralation between REGAL ASIAN and VITEC SOFTWARE

Assuming the 90 days trading horizon REGAL ASIAN INVESTMENTS is expected to under-perform the VITEC SOFTWARE. But the stock apears to be less risky and, when comparing its historical volatility, REGAL ASIAN INVESTMENTS is 1.29 times less risky than VITEC SOFTWARE. The stock trades about -0.43 of its potential returns per unit of risk. The VITEC SOFTWARE GROUP is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest  3,974  in VITEC SOFTWARE GROUP on September 25, 2024 and sell it today you would earn a total of  648.00  from holding VITEC SOFTWARE GROUP or generate 16.31% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

REGAL ASIAN INVESTMENTS  vs.  VITEC SOFTWARE GROUP

 Performance 
       Timeline  
REGAL ASIAN INVESTMENTS 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days REGAL ASIAN INVESTMENTS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
VITEC SOFTWARE GROUP 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in VITEC SOFTWARE GROUP are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, VITEC SOFTWARE is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

REGAL ASIAN and VITEC SOFTWARE Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with REGAL ASIAN and VITEC SOFTWARE

The main advantage of trading using opposite REGAL ASIAN and VITEC SOFTWARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, VITEC SOFTWARE 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 VITEC SOFTWARE will offset losses from the drop in VITEC SOFTWARE's long position.
The idea behind REGAL ASIAN INVESTMENTS and VITEC SOFTWARE GROUP 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.
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.

Other Complementary Tools

Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Sign In To Macroaxis
Sign in to explore Macroaxis' wealth optimization platform and fintech modules
Stocks Directory
Find actively traded stocks across global markets
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance