Correlation Between Computer Modelling and Cybin

Can any of the company-specific risk be diversified away by investing in both Computer Modelling and Cybin 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 Cybin 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 Cybin Inc, you can compare the effects of market volatilities on Computer Modelling and Cybin 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 Cybin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Computer Modelling and Cybin.

Diversification Opportunities for Computer Modelling and Cybin

0.25

Correlation Coefficient

Computer Modelling  Cybin

Modest diversification

The 3 months correlation between Computer and Cybin is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Computer Modelling Group and Cybin Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cybin Inc 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 Cybin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cybin Inc has no effect on the direction of Computer Modelling i.e., Computer Modelling and Cybin go up and down completely randomly.

Pair Corralation between Computer Modelling and Cybin

Assuming the 90 days trading horizon Computer Modelling Group is expected to under-perform the Cybin. But the stock apears to be less risky and, when comparing its historical volatility, Computer Modelling Group is 1.8 times less risky than Cybin. The stock trades about -0.08 of its potential returns per unit of risk. The Cybin Inc is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  1,500  in Cybin Inc on October 20, 2024 and sell it today you would lose (180.00) from holding Cybin Inc or give up 12.0% 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.  Cybin Inc

Computer Modelling

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Computer Modelling Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Cybin Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cybin Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Computer Modelling and Cybin

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

The idea behind Computer Modelling Group and Cybin Inc 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.