Correlation Between Vestis and Connexa Sports

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

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

Diversification Opportunities for Vestis and Connexa Sports

-0.76

Correlation Coefficient

Vestis  Connexa Sports

Pay attention - limited upside

The 3 months correlation between Vestis and Connexa is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Vestis and Connexa Sports Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Connexa Sports Techn and Vestis 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 Vestis are associated (or correlated) with Connexa Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Connexa Sports Techn has no effect on the direction of Vestis i.e., Vestis and Connexa Sports go up and down completely randomly.

Pair Corralation between Vestis and Connexa Sports

Given the investment horizon of 90 days Vestis is expected to under-perform the Connexa Sports. But the stock apears to be less risky and, when comparing its historical volatility, Vestis is 2.02 times less risky than Connexa Sports. The stock trades about -0.02 of its potential returns per unit of risk. The Connexa Sports Technologies is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  120.00  in Connexa Sports Technologies on October 11, 2024 and sell it today you would earn a total of  12.00  from holding Connexa Sports Technologies or generate 10.0% return on investment over 90 days.

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

Vestis  vs.  Connexa Sports Technologies

Vestis

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Vestis are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Vestis may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Connexa Sports Techn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Connexa Sports Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Vestis and Connexa Sports

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

The idea behind Vestis and Connexa Sports 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.