Correlation Between Concentrix and StarTek

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

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

Diversification Opportunities for Concentrix and StarTek

0.69

Correlation Coefficient

Concentrix  StarTek

Poor diversification

The 3 months correlation between Concentrix and StarTek is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Concentrix and StarTek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on StarTek 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 StarTek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of StarTek has no effect on the direction of Concentrix i.e., Concentrix and StarTek go up and down completely randomly.

Pair Corralation between Concentrix and StarTek

If you would invest  322.00  in StarTek on September 17, 2024 and sell it today you would earn a total of  0.00  from holding StarTek or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.54%
Values	Daily Returns

Concentrix  vs.  StarTek

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.

StarTek

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days StarTek has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, StarTek is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Concentrix and StarTek

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

The idea behind Concentrix and StarTek 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.