Correlation Between Computer Modelling and Image Protect

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

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

Diversification Opportunities for Computer Modelling and Image Protect

0.36

Correlation Coefficient

Computer Modelling  Image Protect

Weak diversification

The 3 months correlation between Computer and Image is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Computer Modelling Group and Image Protect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Image Protect and Computer Modelling 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 Computer Modelling Group are associated (or correlated) with Image Protect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Image Protect has no effect on the direction of Computer Modelling i.e., Computer Modelling and Image Protect go up and down completely randomly.

Pair Corralation between Computer Modelling and Image Protect

Assuming the 90 days horizon Computer Modelling Group is expected to under-perform the Image Protect. But the pink sheet apears to be less risky and, when comparing its historical volatility, Computer Modelling Group is 50.04 times less risky than Image Protect. The pink sheet trades about -0.11 of its potential returns per unit of risk. The Image Protect is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  0.02  in Image Protect on December 29, 2024 and sell it today you would lose (0.01) from holding Image Protect or give up 50.0% of portfolio value over 90 days.

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

Computer Modelling Group  vs.  Image Protect

Computer Modelling

Risk-Adjusted Performance

Very Weak

Over the last 90 days Computer Modelling Group 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 nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Image Protect

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Image Protect are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Image Protect disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Computer Modelling and Image Protect

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

The idea behind Computer Modelling Group and Image Protect 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.