Correlation Between Agilysys and AudioEye

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

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

Diversification Opportunities for Agilysys and AudioEye

0.36

Correlation Coefficient

Agilysys  AudioEye

Weak diversification

The 3 months correlation between Agilysys and AudioEye is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Agilysys and AudioEye in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AudioEye and Agilysys 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 Agilysys are associated (or correlated) with AudioEye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AudioEye has no effect on the direction of Agilysys i.e., Agilysys and AudioEye go up and down completely randomly.

Pair Corralation between Agilysys and AudioEye

Given the investment horizon of 90 days Agilysys is expected to under-perform the AudioEye. But the stock apears to be less risky and, when comparing its historical volatility, Agilysys is 1.29 times less risky than AudioEye. The stock trades about -0.25 of its potential returns per unit of risk. The AudioEye is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  1,562  in AudioEye on December 30, 2024 and sell it today you would lose (436.00) from holding AudioEye or give up 27.91% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Agilysys  vs.  AudioEye

Agilysys

Risk-Adjusted Performance

Very Weak

Over the last 90 days Agilysys has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

AudioEye

Risk-Adjusted Performance

Very Weak

Over the last 90 days AudioEye has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Agilysys and AudioEye

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

The idea behind Agilysys and AudioEye 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.