Correlation Between Cemtrex and Telos Corp

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

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

Diversification Opportunities for Cemtrex and Telos Corp

0.71

Correlation Coefficient

Cemtrex  Telos Corp

Poor diversification

The 3 months correlation between Cemtrex and Telos is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Cemtrex and Telos Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telos Corp and Cemtrex 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 Cemtrex are associated (or correlated) with Telos Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telos Corp has no effect on the direction of Cemtrex i.e., Cemtrex and Telos Corp go up and down completely randomly.

Pair Corralation between Cemtrex and Telos Corp

Given the investment horizon of 90 days Cemtrex is expected to under-perform the Telos Corp. In addition to that, Cemtrex is 1.32 times more volatile than Telos Corp. It trades about -0.2 of its total potential returns per unit of risk. Telos Corp is currently generating about -0.13 per unit of volatility. If you would invest  343.00  in Telos Corp on December 29, 2024 and sell it today you would lose (97.00) from holding Telos Corp or give up 28.28% of portfolio value over 90 days.

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

Cemtrex  vs.  Telos Corp

Cemtrex

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cemtrex has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Telos Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Telos Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Cemtrex and Telos Corp

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

The idea behind Cemtrex and Telos Corp 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..