Correlation Between CSI Compressco and Geospace Technologies

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

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

Diversification Opportunities for CSI Compressco and Geospace Technologies

0.2

Correlation Coefficient

CSI Compressco  Geospace Technologies

Modest diversification

The 3 months correlation between CSI and Geospace is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding CSI Compressco LP and Geospace Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geospace Technologies and CSI Compressco 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 CSI Compressco LP are associated (or correlated) with Geospace Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geospace Technologies has no effect on the direction of CSI Compressco i.e., CSI Compressco and Geospace Technologies go up and down completely randomly.

Pair Corralation between CSI Compressco and Geospace Technologies

If you would invest  1,006  in Geospace Technologies on September 12, 2024 and sell it today you would earn a total of  50.00  from holding Geospace Technologies or generate 4.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

CSI Compressco LP  vs.  Geospace Technologies

CSI Compressco LP

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CSI Compressco LP has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, CSI Compressco is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Geospace Technologies

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Geospace Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Geospace Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with CSI Compressco and Geospace Technologies

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

The idea behind CSI Compressco LP and Geospace 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.