Correlation Between CyberArk Software and Arqit Quantum

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

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

Diversification Opportunities for CyberArk Software and Arqit Quantum

-0.43

Correlation Coefficient

CyberArk Software  Arqit Quantum

Very good diversification

The 3 months correlation between CyberArk and Arqit is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding CyberArk Software and Arqit Quantum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arqit Quantum 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 Arqit Quantum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arqit Quantum has no effect on the direction of CyberArk Software i.e., CyberArk Software and Arqit Quantum go up and down completely randomly.

Pair Corralation between CyberArk Software and Arqit Quantum

Given the investment horizon of 90 days CyberArk Software is expected to generate 0.22 times more return on investment than Arqit Quantum. However, CyberArk Software is 4.56 times less risky than Arqit Quantum. It trades about 0.05 of its potential returns per unit of risk. Arqit Quantum is currently generating about -0.09 per unit of risk. If you would invest  31,960  in CyberArk Software on December 29, 2024 and sell it today you would earn a total of  2,161  from holding CyberArk Software or generate 6.76% return on investment over 90 days.

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

CyberArk Software  vs.  Arqit Quantum

CyberArk Software

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CyberArk Software are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal fundamental drivers, CyberArk Software may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Arqit Quantum

Risk-Adjusted Performance

Very Weak

Over the last 90 days Arqit Quantum has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with CyberArk Software and Arqit Quantum

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

The idea behind CyberArk Software and Arqit Quantum 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.