Correlation Between Silver Touch and Cambridge Technology

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

Diversification Opportunities for Silver Touch and Cambridge Technology

SilverCambridgeDiversified AwaySilverCambridgeDiversified Away100%
-0.09
  Correlation Coefficient

Good diversification

The 3 months correlation between Silver and Cambridge is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Silver Touch Technologies and Cambridge Technology Enterpris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambridge Technology and Silver Touch 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 Silver Touch Technologies are associated (or correlated) with Cambridge Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambridge Technology has no effect on the direction of Silver Touch i.e., Silver Touch and Cambridge Technology go up and down completely randomly.

Pair Corralation between Silver Touch and Cambridge Technology

Assuming the 90 days trading horizon Silver Touch Technologies is expected to under-perform the Cambridge Technology. But the stock apears to be less risky and, when comparing its historical volatility, Silver Touch Technologies is 2.12 times less risky than Cambridge Technology. The stock trades about -0.07 of its potential returns per unit of risk. The Cambridge Technology Enterprises is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  9,264  in Cambridge Technology Enterprises on October 26, 2024 and sell it today you would lose (410.00) from holding Cambridge Technology Enterprises or give up 4.43% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Silver Touch Technologies  vs.  Cambridge Technology Enterpris

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -10-505101520
JavaScript chart by amCharts 3.21.15SILVERTUC CTE
       Timeline  
Silver Touch Technologies 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Silver Touch Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan660680700720740760
Cambridge Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Cambridge Technology Enterprises has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Cambridge Technology is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan859095100105110115

Silver Touch and Cambridge Technology Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.51-1.89-1.27-0.66-0.05220.521.111.72.292.88 0.050.100.15
JavaScript chart by amCharts 3.21.15SILVERTUC CTE
       Returns  

Pair Trading with Silver Touch and Cambridge Technology

The main advantage of trading using opposite Silver Touch and Cambridge Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silver Touch position performs unexpectedly, Cambridge 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 Cambridge Technology will offset losses from the drop in Cambridge Technology's long position.
The idea behind Silver Touch Technologies and Cambridge Technology Enterprises 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 Global Correlations module to find global opportunities by holding instruments from different markets.

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