Correlation Between Deltex Medical and Cognizant Technology
Can any of the company-specific risk be diversified away by investing in both Deltex Medical and Cognizant Technology 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 Deltex Medical and Cognizant Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deltex Medical Group and Cognizant Technology Solutions, you can compare the effects of market volatilities on Deltex Medical and Cognizant Technology 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 Deltex Medical with a short position of Cognizant Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deltex Medical and Cognizant Technology.
Diversification Opportunities for Deltex Medical and Cognizant Technology
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deltex and Cognizant is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Deltex Medical Group and Cognizant Technology Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cognizant Technology and Deltex Medical 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 Deltex Medical Group are associated (or correlated) with Cognizant Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cognizant Technology has no effect on the direction of Deltex Medical i.e., Deltex Medical and Cognizant Technology go up and down completely randomly.
Pair Corralation between Deltex Medical and Cognizant Technology
Assuming the 90 days trading horizon Deltex Medical Group is expected to under-perform the Cognizant Technology. In addition to that, Deltex Medical is 3.92 times more volatile than Cognizant Technology Solutions. It trades about -0.1 of its total potential returns per unit of risk. Cognizant Technology Solutions is currently generating about 0.06 per unit of volatility. If you would invest 6,159 in Cognizant Technology Solutions on September 2, 2024 and sell it today you would earn a total of 1,921 from holding Cognizant Technology Solutions or generate 31.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.1% |
| Values | Daily Returns |
Deltex Medical Group vs. Cognizant Technology Solutions
Performance |
| Timeline |
| Deltex Medical Group |
| Cognizant Technology |
Deltex Medical and Cognizant Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deltex Medical and Cognizant Technology
The main advantage of trading using opposite Deltex Medical and Cognizant Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deltex Medical position performs unexpectedly, Cognizant Technology 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 Cognizant Technology will offset losses from the drop in Cognizant Technology's long position.| Deltex Medical vs. Samsung Electronics Co | Deltex Medical vs. Samsung Electronics Co | Deltex Medical vs. Hyundai Motor | Deltex Medical vs. Toyota Motor Corp |
| Cognizant Technology vs. Atalaya Mining | Cognizant Technology vs. Hochschild Mining plc | Cognizant Technology vs. Panther Metals PLC | Cognizant Technology vs. iShares Physical Silver |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |