Correlation Between Regal Funds and Technology One

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

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

Diversification Opportunities for Regal Funds and Technology One

0.32

Correlation Coefficient

Regal Funds  Technology One

Weak diversification

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

Pair Corralation between Regal Funds and Technology One

Assuming the 90 days trading horizon Regal Funds Management is expected to generate 1.88 times more return on investment than Technology One. However, Regal Funds is 1.88 times more volatile than Technology One. It trades about -0.01 of its potential returns per unit of risk. Technology One is currently generating about -0.12 per unit of risk. If you would invest  378.00  in Regal Funds Management on October 8, 2024 and sell it today you would lose (4.00) from holding Regal Funds Management or give up 1.06% of portfolio value over 90 days.

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

Regal Funds Management  vs.  Technology One

Regal Funds Management

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Regal Funds Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable essential indicators, Regal Funds is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Technology One

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Technology One are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Technology One unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Regal Funds and Technology One

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

The idea behind Regal Funds Management and Technology One 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.