Correlation Between EGain and Asure Software
Can any of the company-specific risk be diversified away by investing in both EGain and Asure Software 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 EGain and Asure Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eGain and Asure Software, you can compare the effects of market volatilities on EGain and Asure 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 EGain with a short position of Asure Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGain and Asure Software.
Diversification Opportunities for EGain and Asure Software
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EGain and Asure is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding eGain and Asure Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asure Software and EGain 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 eGain are associated (or correlated) with Asure Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asure Software has no effect on the direction of EGain i.e., EGain and Asure Software go up and down completely randomly.
Pair Corralation between EGain and Asure Software
Given the investment horizon of 90 days eGain is expected to generate 0.94 times more return on investment than Asure Software. However, eGain is 1.07 times less risky than Asure Software. It trades about 0.1 of its potential returns per unit of risk. Asure Software is currently generating about 0.01 per unit of risk. If you would invest 494.00 in eGain on August 24, 2024 and sell it today you would earn a total of 43.00 from holding eGain or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
eGain vs. Asure Software
Performance |
| Timeline |
| eGain |
| Asure Software |
EGain and Asure Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGain and Asure Software
The main advantage of trading using opposite EGain and Asure Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGain position performs unexpectedly, Asure 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 Asure Software will offset losses from the drop in Asure Software's long position.The idea behind eGain and Asure Software 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.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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