Correlation Between CyberArk Software and Brockhaus Capital

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Can any of the company-specific risk be diversified away by investing in both CyberArk Software and Brockhaus Capital 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 CyberArk Software and Brockhaus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CyberArk Software and Brockhaus Capital Management, you can compare the effects of market volatilities on CyberArk Software and Brockhaus Capital 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 CyberArk Software with a short position of Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of CyberArk Software and Brockhaus Capital.

Diversification Opportunities for CyberArk Software and Brockhaus Capital

-0.71
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between CyberArk and Brockhaus is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding CyberArk Software and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital and CyberArk Software 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 CyberArk Software are associated (or correlated) with Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of CyberArk Software i.e., CyberArk Software and Brockhaus Capital go up and down completely randomly.

Pair Corralation between CyberArk Software and Brockhaus Capital

Assuming the 90 days trading horizon CyberArk Software is expected to generate 0.93 times more return on investment than Brockhaus Capital. However, CyberArk Software is 1.08 times less risky than Brockhaus Capital. It trades about 0.15 of its potential returns per unit of risk. Brockhaus Capital Management is currently generating about 0.08 per unit of risk. If you would invest  30,790  in CyberArk Software on October 10, 2024 and sell it today you would earn a total of  2,180  from holding CyberArk Software or generate 7.08% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

CyberArk Software  vs.  Brockhaus Capital Management

 Performance 
       Timeline  
CyberArk Software 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in CyberArk Software are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CyberArk Software unveiled solid returns over the last few months and may actually be approaching a breakup point.
Brockhaus Capital 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Brockhaus Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

CyberArk Software and Brockhaus Capital Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CyberArk Software and Brockhaus Capital

The main advantage of trading using opposite CyberArk Software and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CyberArk Software position performs unexpectedly, Brockhaus Capital 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.
The idea behind CyberArk Software and Brockhaus Capital Management 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

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