Correlation Between Tevano Systems and Sharps Technology

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

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

Diversification Opportunities for Tevano Systems and Sharps Technology

0.28

Correlation Coefficient

Tevano Systems  Sharps Technology

Modest diversification

The 3 months correlation between Tevano and Sharps is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Tevano Systems Holdings and Sharps Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sharps Technology and Tevano Systems 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 Tevano Systems Holdings are associated (or correlated) with Sharps Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sharps Technology has no effect on the direction of Tevano Systems i.e., Tevano Systems and Sharps Technology go up and down completely randomly.

Pair Corralation between Tevano Systems and Sharps Technology

Assuming the 90 days horizon Tevano Systems Holdings is expected to under-perform the Sharps Technology. In addition to that, Tevano Systems is 1.76 times more volatile than Sharps Technology. It trades about -0.13 of its total potential returns per unit of risk. Sharps Technology is currently generating about -0.11 per unit of volatility. If you would invest  667.00  in Sharps Technology on September 4, 2024 and sell it today you would lose (332.00) from holding Sharps Technology or give up 49.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	96.88%
Values	Daily Returns

Tevano Systems Holdings  vs.  Sharps Technology

Tevano Systems Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tevano Systems Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Sharps Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sharps Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Tevano Systems and Sharps Technology

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

The idea behind Tevano Systems Holdings and Sharps Technology 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.