Correlation Between Civeo Corp and Information Services

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

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

Diversification Opportunities for Civeo Corp and Information Services

-0.74

Correlation Coefficient

Civeo Corp  Information Services

Pay attention - limited upside

The 3 months correlation between Civeo and Information is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Civeo Corp and Information Services Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information Services and Civeo Corp 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 Civeo Corp are associated (or correlated) with Information Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information Services has no effect on the direction of Civeo Corp i.e., Civeo Corp and Information Services go up and down completely randomly.

Pair Corralation between Civeo Corp and Information Services

Given the investment horizon of 90 days Civeo Corp is expected to generate 1.15 times more return on investment than Information Services. However, Civeo Corp is 1.15 times more volatile than Information Services Group. It trades about -0.01 of its potential returns per unit of risk. Information Services Group is currently generating about -0.01 per unit of risk. If you would invest  2,908  in Civeo Corp on September 28, 2024 and sell it today you would lose (690.00) from holding Civeo Corp or give up 23.73% of portfolio value over 90 days.

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

Civeo Corp  vs.  Information Services Group

Civeo Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Information Services

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Information Services Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Information Services is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Civeo Corp and Information Services

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

The idea behind Civeo Corp and Information Services Group 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.