Correlation Between Evolving Systems and Marin Software

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

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

Diversification Opportunities for Evolving Systems and Marin Software

0.46

Correlation Coefficient

Evolving Systems  Marin Software

Very weak diversification

The 3 months correlation between Evolving and Marin is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Evolving Systems and Marin Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marin Software and Evolving 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 Evolving Systems are associated (or correlated) with Marin Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marin Software has no effect on the direction of Evolving Systems i.e., Evolving Systems and Marin Software go up and down completely randomly.

Pair Corralation between Evolving Systems and Marin Software

If you would invest  220.00  in Marin Software on October 9, 2024 and sell it today you would earn a total of  11.00  from holding Marin Software or generate 5.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	0.4%
Values	Daily Returns

Evolving Systems  vs.  Marin Software

Evolving Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Evolving Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Evolving Systems is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Marin Software

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Marin Software are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Marin Software may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Evolving Systems and Marin Software

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

The idea behind Evolving Systems and Marin Software 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.