Correlation Between CyberArk Software and TITANIUM TRANSPORTGROUP

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

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

Diversification Opportunities for CyberArk Software and TITANIUM TRANSPORTGROUP

0.72

Correlation Coefficient

CyberArk Software  TITANIUM TRANSPORTGROUP

Poor diversification

The 3 months correlation between CyberArk and TITANIUM is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding CyberArk Software and TITANIUM TRANSPORTGROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TITANIUM TRANSPORTGROUP 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 TITANIUM TRANSPORTGROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TITANIUM TRANSPORTGROUP has no effect on the direction of CyberArk Software i.e., CyberArk Software and TITANIUM TRANSPORTGROUP go up and down completely randomly.

Pair Corralation between CyberArk Software and TITANIUM TRANSPORTGROUP

Assuming the 90 days trading horizon CyberArk Software is expected to generate 1.07 times more return on investment than TITANIUM TRANSPORTGROUP. However, CyberArk Software is 1.07 times more volatile than TITANIUM TRANSPORTGROUP. It trades about 0.09 of its potential returns per unit of risk. TITANIUM TRANSPORTGROUP is currently generating about 0.02 per unit of risk. If you would invest  20,900  in CyberArk Software on October 9, 2024 and sell it today you would earn a total of  12,070  from holding CyberArk Software or generate 57.75% return on investment over 90 days.

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

CyberArk Software  vs.  TITANIUM TRANSPORTGROUP

CyberArk Software

Risk-Adjusted Performance

11 of 100

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.

TITANIUM TRANSPORTGROUP

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in TITANIUM TRANSPORTGROUP are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, TITANIUM TRANSPORTGROUP may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with CyberArk Software and TITANIUM TRANSPORTGROUP

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

The idea behind CyberArk Software and TITANIUM TRANSPORTGROUP 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 Transaction History module to view history of all your transactions and understand their impact on performance.