Correlation Between Cognizant Technology and Identiv
Can any of the company-specific risk be diversified away by investing in both Cognizant Technology and Identiv 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 Cognizant Technology and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cognizant Technology Solutions and Identiv, you can compare the effects of market volatilities on Cognizant Technology and Identiv 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 Cognizant Technology with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognizant Technology and Identiv.
Diversification Opportunities for Cognizant Technology and Identiv
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cognizant and Identiv is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Cognizant Technology Solutions and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Cognizant Technology 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 Cognizant Technology Solutions are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Cognizant Technology i.e., Cognizant Technology and Identiv go up and down completely randomly.
Pair Corralation between Cognizant Technology and Identiv
Assuming the 90 days horizon Cognizant Technology is expected to generate 1.55 times less return on investment than Identiv. But when comparing it to its historical volatility, Cognizant Technology Solutions is 1.44 times less risky than Identiv. It trades about 0.21 of its potential returns per unit of risk. Identiv is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 322.00 in Identiv on August 28, 2024 and sell it today you would earn a total of 49.00 from holding Identiv or generate 15.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cognizant Technology Solutions vs. Identiv
Performance |
| Timeline |
| Cognizant Technology |
| Identiv |
Cognizant Technology and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cognizant Technology and Identiv
The main advantage of trading using opposite Cognizant Technology and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cognizant Technology position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Cognizant Technology vs. ATRESMEDIA | Cognizant Technology vs. SEI INVESTMENTS | Cognizant Technology vs. REGAL ASIAN INVESTMENTS | Cognizant Technology vs. ANTA SPORTS PRODUCT |
| Identiv vs. Superior Plus Corp | Identiv vs. Origin Agritech | Identiv vs. INTUITIVE SURGICAL | Identiv vs. Volkswagen AG |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |