Correlation Between CNVISION MEDIA and Keysight Technologies

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

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

Diversification Opportunities for CNVISION MEDIA and Keysight Technologies

-0.28

Correlation Coefficient

CNVISION MEDIA  Keysight Technologies

Very good diversification

The 3 months correlation between CNVISION and Keysight is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding CNVISION MEDIA and Keysight Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keysight Technologies and CNVISION MEDIA 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 CNVISION MEDIA are associated (or correlated) with Keysight Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keysight Technologies has no effect on the direction of CNVISION MEDIA i.e., CNVISION MEDIA and Keysight Technologies go up and down completely randomly.

Pair Corralation between CNVISION MEDIA and Keysight Technologies

Assuming the 90 days trading horizon CNVISION MEDIA is expected to generate 2.08 times more return on investment than Keysight Technologies. However, CNVISION MEDIA is 2.08 times more volatile than Keysight Technologies. It trades about 0.17 of its potential returns per unit of risk. Keysight Technologies is currently generating about -0.18 per unit of risk. If you would invest  5.15  in CNVISION MEDIA on October 8, 2024 and sell it today you would earn a total of  0.40  from holding CNVISION MEDIA or generate 7.77% return on investment over 90 days.

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

CNVISION MEDIA  vs.  Keysight Technologies

CNVISION MEDIA

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CNVISION MEDIA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, CNVISION MEDIA is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Keysight Technologies

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Keysight Technologies are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Keysight Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CNVISION MEDIA and Keysight Technologies

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

The idea behind CNVISION MEDIA and Keysight 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.

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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.