Correlation Between Lesaka Technologies and OneSpan

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

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

Diversification Opportunities for Lesaka Technologies and OneSpan

0.54

Correlation Coefficient

Lesaka Technologies  OneSpan

Very weak diversification

The 3 months correlation between Lesaka and OneSpan is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Lesaka Technologies and OneSpan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneSpan and Lesaka 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 Lesaka Technologies are associated (or correlated) with OneSpan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneSpan has no effect on the direction of Lesaka Technologies i.e., Lesaka Technologies and OneSpan go up and down completely randomly.

Pair Corralation between Lesaka Technologies and OneSpan

Given the investment horizon of 90 days Lesaka Technologies is expected to generate 0.96 times more return on investment than OneSpan. However, Lesaka Technologies is 1.04 times less risky than OneSpan. It trades about -0.03 of its potential returns per unit of risk. OneSpan is currently generating about -0.11 per unit of risk. If you would invest  539.00  in Lesaka Technologies on December 29, 2024 and sell it today you would lose (32.00) from holding Lesaka Technologies or give up 5.94% of portfolio value over 90 days.

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

Lesaka Technologies  vs.  OneSpan

Lesaka Technologies

Risk-Adjusted Performance

Very Weak

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

OneSpan

Risk-Adjusted Performance

Very Weak

Over the last 90 days OneSpan has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Lesaka Technologies and OneSpan

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

The idea behind Lesaka Technologies and OneSpan 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.