Correlation Between Synchronoss Technologies and International Business

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

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

Diversification Opportunities for Synchronoss Technologies and International Business

0.09

Correlation Coefficient

Synchronoss Technologies  International Business

Significant diversification

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

Pair Corralation between Synchronoss Technologies and International Business

Given the investment horizon of 90 days Synchronoss Technologies is expected to generate 2.13 times more return on investment than International Business. However, Synchronoss Technologies is 2.13 times more volatile than International Business Machines. It trades about -0.05 of its potential returns per unit of risk. International Business Machines is currently generating about -0.21 per unit of risk. If you would invest  986.00  in Synchronoss Technologies on October 5, 2024 and sell it today you would lose (35.00) from holding Synchronoss Technologies or give up 3.55% of portfolio value over 90 days.

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

Synchronoss Technologies  vs.  International Business Machine

Synchronoss Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Synchronoss Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

International Business

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International Business Machines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, International Business is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Synchronoss Technologies and International Business

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

The idea behind Synchronoss Technologies and International Business Machines 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.

Check out your portfolio center.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..