Correlation Between Roper Technologies, and ANSYS

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

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

Diversification Opportunities for Roper Technologies, and ANSYS

0.32

Correlation Coefficient

Roper Technologies,  ANSYS

Weak diversification

The 3 months correlation between Roper and ANSYS is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Roper Technologies, and ANSYS Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANSYS Inc and Roper 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 Roper Technologies, are associated (or correlated) with ANSYS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANSYS Inc has no effect on the direction of Roper Technologies, i.e., Roper Technologies, and ANSYS go up and down completely randomly.

Pair Corralation between Roper Technologies, and ANSYS

Considering the 90-day investment horizon Roper Technologies, is expected to under-perform the ANSYS. But the stock apears to be less risky and, when comparing its historical volatility, Roper Technologies, is 1.54 times less risky than ANSYS. The stock trades about -0.64 of its potential returns per unit of risk. The ANSYS Inc is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest  36,145  in ANSYS Inc on October 5, 2024 and sell it today you would lose (2,539) from holding ANSYS Inc or give up 7.02% of portfolio value over 90 days.

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

Roper Technologies,  vs.  ANSYS Inc

Roper Technologies,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Roper Technologies, has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Roper Technologies, is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

ANSYS Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ANSYS Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, ANSYS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Roper Technologies, and ANSYS

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

The idea behind Roper Technologies, and ANSYS Inc 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.