Correlation Between Capstone Technologies and Concentrix

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

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

Diversification Opportunities for Capstone Technologies and Concentrix

-0.34

Correlation Coefficient

Capstone Technologies  Concentrix

Very good diversification

The 3 months correlation between Capstone and Concentrix is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Capstone Technologies Group and Concentrix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concentrix and Capstone Technologies 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 Capstone Technologies Group are associated (or correlated) with Concentrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concentrix has no effect on the direction of Capstone Technologies i.e., Capstone Technologies and Concentrix go up and down completely randomly.

Pair Corralation between Capstone Technologies and Concentrix

Given the investment horizon of 90 days Capstone Technologies is expected to generate 360.92 times less return on investment than Concentrix. But when comparing it to its historical volatility, Capstone Technologies Group is 5.46 times less risky than Concentrix. It trades about 0.0 of its potential returns per unit of risk. Concentrix is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  3,703  in Concentrix on November 19, 2024 and sell it today you would earn a total of  1,109  from holding Concentrix or generate 29.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Capstone Technologies Group  vs.  Concentrix

Capstone Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Capstone Technologies Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Capstone Technologies is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Concentrix

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Concentrix are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Concentrix exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Capstone Technologies and Concentrix

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

The idea behind Capstone Technologies Group and Concentrix 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.