Correlation Between Iveda Solutions and SSC Security

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Can any of the company-specific risk be diversified away by investing in both Iveda Solutions and SSC Security 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 Iveda Solutions and SSC Security into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iveda Solutions and SSC Security Services, you can compare the effects of market volatilities on Iveda Solutions and SSC Security 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 Iveda Solutions with a short position of SSC Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iveda Solutions and SSC Security.

Diversification Opportunities for Iveda Solutions and SSC Security

-0.03
  Correlation Coefficient

Good diversification

The 3 months correlation between Iveda and SSC is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Iveda Solutions and SSC Security Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSC Security Services and Iveda Solutions 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 Iveda Solutions are associated (or correlated) with SSC Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSC Security Services has no effect on the direction of Iveda Solutions i.e., Iveda Solutions and SSC Security go up and down completely randomly.

Pair Corralation between Iveda Solutions and SSC Security

Given the investment horizon of 90 days Iveda Solutions is expected to generate 12.06 times more return on investment than SSC Security. However, Iveda Solutions is 12.06 times more volatile than SSC Security Services. It trades about 0.24 of its potential returns per unit of risk. SSC Security Services is currently generating about -0.01 per unit of risk. If you would invest  165.00  in Iveda Solutions on October 2, 2024 and sell it today you would earn a total of  577.00  from holding Iveda Solutions or generate 349.7% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.41%
ValuesDaily Returns

Iveda Solutions  vs.  SSC Security Services

 Performance 
       Timeline  
Iveda Solutions 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Iveda Solutions are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent fundamental indicators, Iveda Solutions sustained solid returns over the last few months and may actually be approaching a breakup point.
SSC Security Services 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days SSC Security Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SSC Security is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Iveda Solutions and SSC Security Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Iveda Solutions and SSC Security

The main advantage of trading using opposite Iveda Solutions and SSC Security positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iveda Solutions position performs unexpectedly, SSC Security 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 SSC Security will offset losses from the drop in SSC Security's long position.
The idea behind Iveda Solutions and SSC Security Services 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

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