Correlation Between Cyxtera Technologies and Broadridge Financial

Can any of the company-specific risk be diversified away by investing in both Cyxtera Technologies and Broadridge Financial 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 Cyxtera Technologies and Broadridge Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cyxtera Technologies and Broadridge Financial Solutions, you can compare the effects of market volatilities on Cyxtera Technologies and Broadridge Financial 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 Cyxtera Technologies with a short position of Broadridge Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cyxtera Technologies and Broadridge Financial.

Diversification Opportunities for Cyxtera Technologies and Broadridge Financial

-0.77

Correlation Coefficient

Cyxtera Technologies  Broadridge Financial

Pay attention - limited upside

The 3 months correlation between Cyxtera and Broadridge is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Cyxtera Technologies and Broadridge Financial Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Broadridge Financial and Cyxtera Technologies 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 Cyxtera Technologies are associated (or correlated) with Broadridge Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Broadridge Financial has no effect on the direction of Cyxtera Technologies i.e., Cyxtera Technologies and Broadridge Financial go up and down completely randomly.

Pair Corralation between Cyxtera Technologies and Broadridge Financial

If you would invest  4.68  in Cyxtera Technologies on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Cyxtera Technologies or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	5.0%
Values	Daily Returns

Cyxtera Technologies  vs.  Broadridge Financial Solutions

Cyxtera Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cyxtera Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cyxtera Technologies is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Broadridge Financial

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Broadridge Financial Solutions are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Broadridge Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Cyxtera Technologies and Broadridge Financial

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

The idea behind Cyxtera Technologies and Broadridge Financial Solutions 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.

Check out your portfolio center.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.