Correlation Between CSG Systems and Repay Holdings
Can any of the company-specific risk be diversified away by investing in both CSG Systems and Repay Holdings 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 CSG Systems and Repay Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSG Systems International and Repay Holdings Corp, you can compare the effects of market volatilities on CSG Systems and Repay Holdings 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 CSG Systems with a short position of Repay Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSG Systems and Repay Holdings.
Diversification Opportunities for CSG Systems and Repay Holdings
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CSG and Repay is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding CSG Systems International and Repay Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Repay Holdings Corp and CSG Systems 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 CSG Systems International are associated (or correlated) with Repay Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Repay Holdings Corp has no effect on the direction of CSG Systems i.e., CSG Systems and Repay Holdings go up and down completely randomly.
Pair Corralation between CSG Systems and Repay Holdings
Given the investment horizon of 90 days CSG Systems International is expected to generate 0.6 times more return on investment than Repay Holdings. However, CSG Systems International is 1.66 times less risky than Repay Holdings. It trades about -0.03 of its potential returns per unit of risk. Repay Holdings Corp is currently generating about -0.07 per unit of risk. If you would invest 5,392 in CSG Systems International on October 20, 2024 and sell it today you would lose (107.00) from holding CSG Systems International or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSG Systems International vs. Repay Holdings Corp
Performance |
| Timeline |
| CSG Systems International |
| Repay Holdings Corp |
CSG Systems and Repay Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSG Systems and Repay Holdings
The main advantage of trading using opposite CSG Systems and Repay Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSG Systems position performs unexpectedly, Repay Holdings 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 Repay Holdings will offset losses from the drop in Repay Holdings' long position.| CSG Systems vs. NetScout Systems | CSG Systems vs. Consensus Cloud Solutions | CSG Systems vs. Secureworks Corp | CSG Systems vs. Evertec |
| Repay Holdings vs. Global Blue Group | Repay Holdings vs. Optiva Inc | Repay Holdings vs. Sangoma Technologies Corp | Repay Holdings vs. Evertec |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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