Correlation Between Cass Information and Team

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

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

Diversification Opportunities for Cass Information and Team

-0.3

Correlation Coefficient

Cass Information  Team

Very good diversification

The 3 months correlation between Cass and Team is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Cass Information Systems and Team Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Team Inc and Cass Information 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 Cass Information Systems are associated (or correlated) with Team. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Team Inc has no effect on the direction of Cass Information i.e., Cass Information and Team go up and down completely randomly.

Pair Corralation between Cass Information and Team

Given the investment horizon of 90 days Cass Information Systems is expected to under-perform the Team. But the stock apears to be less risky and, when comparing its historical volatility, Cass Information Systems is 3.32 times less risky than Team. The stock trades about 0.0 of its potential returns per unit of risk. The Team Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  800.00  in Team Inc on October 11, 2024 and sell it today you would earn a total of  769.00  from holding Team Inc or generate 96.13% return on investment over 90 days.

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

Cass Information Systems  vs.  Team Inc

Cass Information Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cass Information Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cass Information is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Team Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Team Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Cass Information and Team

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

The idea behind Cass Information Systems and Team Inc 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.