Correlation Between Apptech Corp and Synchronoss Technologies

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

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

Diversification Opportunities for Apptech Corp and Synchronoss Technologies

0.5

Correlation Coefficient

Apptech Corp  Synchronoss Technologies

Very weak diversification

The 3 months correlation between Apptech and Synchronoss is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Apptech Corp and Synchronoss Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synchronoss Technologies and Apptech Corp 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 Apptech Corp are associated (or correlated) with Synchronoss Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synchronoss Technologies has no effect on the direction of Apptech Corp i.e., Apptech Corp and Synchronoss Technologies go up and down completely randomly.

Pair Corralation between Apptech Corp and Synchronoss Technologies

Given the investment horizon of 90 days Apptech Corp is expected to under-perform the Synchronoss Technologies. In addition to that, Apptech Corp is 1.3 times more volatile than Synchronoss Technologies. It trades about -0.1 of its total potential returns per unit of risk. Synchronoss Technologies is currently generating about -0.12 per unit of volatility. If you would invest  1,471  in Synchronoss Technologies on September 1, 2024 and sell it today you would lose (483.00) from holding Synchronoss Technologies or give up 32.83% of portfolio value over 90 days.

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

Apptech Corp  vs.  Synchronoss Technologies

Apptech Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apptech Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Synchronoss Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Synchronoss Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in December 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Apptech Corp and Synchronoss Technologies

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

The idea behind Apptech Corp and Synchronoss Technologies 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.