Correlation Between Cybertech Systems and General Insurance

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

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

Diversification Opportunities for Cybertech Systems and General Insurance

0.68

Correlation Coefficient

Cybertech Systems  General Insurance

Poor diversification

The 3 months correlation between Cybertech and General is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Cybertech Systems And and General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Insurance and Cybertech Systems 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 Cybertech Systems And are associated (or correlated) with General Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Insurance has no effect on the direction of Cybertech Systems i.e., Cybertech Systems and General Insurance go up and down completely randomly.

Pair Corralation between Cybertech Systems and General Insurance

Assuming the 90 days trading horizon Cybertech Systems And is expected to under-perform the General Insurance. In addition to that, Cybertech Systems is 1.17 times more volatile than General Insurance. It trades about -0.15 of its total potential returns per unit of risk. General Insurance is currently generating about -0.04 per unit of volatility. If you would invest  47,320  in General Insurance on December 27, 2024 and sell it today you would lose (5,305) from holding General Insurance or give up 11.21% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

Cybertech Systems And  vs.  General Insurance

Cybertech Systems And

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cybertech Systems And 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 rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

General Insurance

Risk-Adjusted Performance

Very Weak

Over the last 90 days General Insurance has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Cybertech Systems and General Insurance

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

The idea behind Cybertech Systems And and General Insurance 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.