Correlation Between CBIZ and CSG Systems
Can any of the company-specific risk be diversified away by investing in both CBIZ and CSG Systems 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 CBIZ and CSG Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBIZ Inc and CSG Systems International, you can compare the effects of market volatilities on CBIZ and CSG Systems 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 CBIZ with a short position of CSG Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBIZ and CSG Systems.
Diversification Opportunities for CBIZ and CSG Systems
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CBIZ and CSG is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding CBIZ Inc and CSG Systems International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSG Systems International and CBIZ 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 CBIZ Inc are associated (or correlated) with CSG Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSG Systems International has no effect on the direction of CBIZ i.e., CBIZ and CSG Systems go up and down completely randomly.
Pair Corralation between CBIZ and CSG Systems
Considering the 90-day investment horizon CBIZ Inc is expected to generate 0.93 times more return on investment than CSG Systems. However, CBIZ Inc is 1.08 times less risky than CSG Systems. It trades about 0.07 of its potential returns per unit of risk. CSG Systems International is currently generating about 0.01 per unit of risk. If you would invest 4,960 in CBIZ Inc on August 30, 2024 and sell it today you would earn a total of 3,340 from holding CBIZ Inc or generate 67.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
CBIZ Inc vs. CSG Systems International
Performance |
| Timeline |
| CBIZ Inc |
| CSG Systems International |
CBIZ and CSG Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBIZ and CSG Systems
The main advantage of trading using opposite CBIZ and CSG Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBIZ position performs unexpectedly, CSG Systems 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 CSG Systems will offset losses from the drop in CSG Systems' long position.The idea behind CBIZ Inc and CSG Systems International 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.| CSG Systems vs. Oneconnect Financial Technology | CSG Systems vs. Global Business Travel | CSG Systems vs. Alight Inc | CSG Systems vs. CS Disco LLC |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |