Correlation Between Concentrix and FiscalNote Holdings

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

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

Diversification Opportunities for Concentrix and FiscalNote Holdings

0.66

Correlation Coefficient

Concentrix  FiscalNote Holdings

Poor diversification

The 3 months correlation between Concentrix and FiscalNote is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Concentrix and FiscalNote Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FiscalNote Holdings and Concentrix 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 Concentrix are associated (or correlated) with FiscalNote Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FiscalNote Holdings has no effect on the direction of Concentrix i.e., Concentrix and FiscalNote Holdings go up and down completely randomly.

Pair Corralation between Concentrix and FiscalNote Holdings

Given the investment horizon of 90 days Concentrix is expected to under-perform the FiscalNote Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Concentrix is 1.83 times less risky than FiscalNote Holdings. The stock trades about -0.09 of its potential returns per unit of risk. The FiscalNote Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  105.00  in FiscalNote Holdings on September 25, 2024 and sell it today you would earn a total of  9.00  from holding FiscalNote Holdings or generate 8.57% return on investment over 90 days.

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

Concentrix  vs.  FiscalNote Holdings

Concentrix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Concentrix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

FiscalNote Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FiscalNote Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, FiscalNote Holdings is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Concentrix and FiscalNote Holdings

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

The idea behind Concentrix and FiscalNote Holdings 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.