Correlation Between Comvex SA and Impact Develop

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

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

Diversification Opportunities for Comvex SA and Impact Develop

0.06

Correlation Coefficient

Comvex SA  Impact Develop

Significant diversification

The 3 months correlation between Comvex and Impact is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Comvex SA and Impact Develop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impact Develop and Comvex SA 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 Comvex SA are associated (or correlated) with Impact Develop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impact Develop has no effect on the direction of Comvex SA i.e., Comvex SA and Impact Develop go up and down completely randomly.

Pair Corralation between Comvex SA and Impact Develop

If you would invest  7,900  in Comvex SA on October 9, 2024 and sell it today you would earn a total of  400.00  from holding Comvex SA or generate 5.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Comvex SA  vs.  Impact Develop

Comvex SA

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Comvex SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very unfluctuating basic indicators, Comvex SA may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Impact Develop

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Impact Develop has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Impact Develop is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Comvex SA and Impact Develop

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

The idea behind Comvex SA and Impact Develop 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..