Correlation Between Aptech and Newgen Software
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By analyzing existing cross correlation between Aptech Limited and Newgen Software Technologies, you can compare the effects of market volatilities on Aptech and Newgen Software 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 Aptech with a short position of Newgen Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptech and Newgen Software.
Diversification Opportunities for Aptech and Newgen Software
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aptech and Newgen is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Aptech Limited and Newgen Software Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newgen Software Tech and Aptech 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 Aptech Limited are associated (or correlated) with Newgen Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newgen Software Tech has no effect on the direction of Aptech i.e., Aptech and Newgen Software go up and down completely randomly.
Pair Corralation between Aptech and Newgen Software
Assuming the 90 days trading horizon Aptech Limited is expected to generate 0.48 times more return on investment than Newgen Software. However, Aptech Limited is 2.1 times less risky than Newgen Software. It trades about -0.14 of its potential returns per unit of risk. Newgen Software Technologies is currently generating about -0.33 per unit of risk. If you would invest 17,274 in Aptech Limited on November 5, 2024 and sell it today you would lose (1,510) from holding Aptech Limited or give up 8.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aptech Limited vs. Newgen Software Technologies
Performance |
| Timeline |
| Aptech Limited |
| Newgen Software Tech |
Aptech and Newgen Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aptech and Newgen Software
The main advantage of trading using opposite Aptech and Newgen Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aptech position performs unexpectedly, Newgen Software 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 Newgen Software will offset losses from the drop in Newgen Software's long position.| Aptech vs. MIC Electronics Limited | Aptech vs. Hindustan Construction | Aptech vs. Garuda Construction Engineering | Aptech vs. Silgo Retail Limited |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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