Correlation Between Paycor HCM and Aeries Technology

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

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

Diversification Opportunities for Paycor HCM and Aeries Technology

-0.96

Correlation Coefficient

Paycor HCM  Aeries Technology

Pay attention - limited upside

The 3 months correlation between Paycor and Aeries is -0.96. Overlapping area represents the amount of risk that can be diversified away by holding Paycor HCM and Aeries Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeries Technology and Paycor HCM 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 Paycor HCM are associated (or correlated) with Aeries Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeries Technology has no effect on the direction of Paycor HCM i.e., Paycor HCM and Aeries Technology go up and down completely randomly.

Pair Corralation between Paycor HCM and Aeries Technology

Given the investment horizon of 90 days Paycor HCM is expected to generate 0.14 times more return on investment than Aeries Technology. However, Paycor HCM is 7.41 times less risky than Aeries Technology. It trades about 0.18 of its potential returns per unit of risk. Aeries Technology is currently generating about -0.04 per unit of risk. If you would invest  1,620  in Paycor HCM on October 6, 2024 and sell it today you would earn a total of  234.00  from holding Paycor HCM or generate 14.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	97.62%
Values	Daily Returns

Paycor HCM  vs.  Aeries Technology

Paycor HCM

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Paycor HCM are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental indicators, Paycor HCM reported solid returns over the last few months and may actually be approaching a breakup point.

Aeries Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aeries Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Paycor HCM and Aeries Technology

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

The idea behind Paycor HCM and Aeries Technology 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 Managers module to screen money managers from public funds and ETFs managed around the world.