Correlation Between Sterling Check and Lesaka Technologies

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

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

Diversification Opportunities for Sterling Check and Lesaka Technologies

0.0

Correlation Coefficient

Sterling Check  Lesaka Technologies

Pay attention - limited upside

The 3 months correlation between Sterling and Lesaka is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Check Corp and Lesaka Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lesaka Technologies and Sterling Check 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 Sterling Check Corp are associated (or correlated) with Lesaka Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lesaka Technologies has no effect on the direction of Sterling Check i.e., Sterling Check and Lesaka Technologies go up and down completely randomly.

Pair Corralation between Sterling Check and Lesaka Technologies

If you would invest (100.00) in Sterling Check Corp on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Sterling Check Corp or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Sterling Check Corp  vs.  Lesaka Technologies

Sterling Check Corp

Risk-Adjusted Performance

Very Weak

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

Lesaka Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lesaka Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Lesaka Technologies is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Sterling Check and Lesaka Technologies

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

The idea behind Sterling Check Corp and Lesaka Technologies 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.