Correlation Between TTEC Holdings and Widepoint

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

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

Diversification Opportunities for TTEC Holdings and Widepoint

0.94

Correlation Coefficient

TTEC Holdings  Widepoint

Almost no diversification

The 3 months correlation between TTEC and Widepoint is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding TTEC Holdings and Widepoint C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Widepoint C and TTEC Holdings 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 TTEC Holdings are associated (or correlated) with Widepoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Widepoint C has no effect on the direction of TTEC Holdings i.e., TTEC Holdings and Widepoint go up and down completely randomly.

Pair Corralation between TTEC Holdings and Widepoint

Given the investment horizon of 90 days TTEC Holdings is expected to under-perform the Widepoint. But the stock apears to be less risky and, when comparing its historical volatility, TTEC Holdings is 1.61 times less risky than Widepoint. The stock trades about -0.24 of its potential returns per unit of risk. The Widepoint C is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  485.00  in Widepoint C on December 1, 2024 and sell it today you would lose (106.00) from holding Widepoint C or give up 21.86% of portfolio value over 90 days.

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

TTEC Holdings  vs.  Widepoint C

TTEC Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days TTEC Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Widepoint C

Risk-Adjusted Performance

Very Weak

Over the last 90 days Widepoint C has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with TTEC Holdings and Widepoint

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

The idea behind TTEC Holdings and Widepoint C 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.