Correlation Between Enghouse Systems and Converge Technology
Can any of the company-specific risk be diversified away by investing in both Enghouse Systems and Converge 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 Enghouse Systems and Converge Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enghouse Systems and Converge Technology Solutions, you can compare the effects of market volatilities on Enghouse Systems and Converge 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 Enghouse Systems with a short position of Converge Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enghouse Systems and Converge Technology.
Diversification Opportunities for Enghouse Systems and Converge Technology
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Enghouse and Converge is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Enghouse Systems and Converge Technology Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Converge Technology and Enghouse 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 Enghouse Systems are associated (or correlated) with Converge Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Converge Technology has no effect on the direction of Enghouse Systems i.e., Enghouse Systems and Converge Technology go up and down completely randomly.
Pair Corralation between Enghouse Systems and Converge Technology
Assuming the 90 days trading horizon Enghouse Systems is expected to under-perform the Converge Technology. But the stock apears to be less risky and, when comparing its historical volatility, Enghouse Systems is 1.68 times less risky than Converge Technology. The stock trades about -0.02 of its potential returns per unit of risk. The Converge Technology Solutions is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 435.00 in Converge Technology Solutions on November 9, 2024 and sell it today you would lose (82.00) from holding Converge Technology Solutions or give up 18.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Enghouse Systems vs. Converge Technology Solutions
Performance |
| Timeline |
| Enghouse Systems |
| Converge Technology |
Enghouse Systems and Converge Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enghouse Systems and Converge Technology
The main advantage of trading using opposite Enghouse Systems and Converge Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enghouse Systems position performs unexpectedly, Converge 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 Converge Technology will offset losses from the drop in Converge Technology's long position.| Enghouse Systems vs. Kinaxis | Enghouse Systems vs. Open Text Corp | Enghouse Systems vs. Descartes Systems Group | Enghouse Systems vs. Constellation Software |
| Converge Technology vs. Dye Durham | Converge Technology vs. Docebo Inc | Converge Technology vs. Topicus | Converge Technology vs. goeasy |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |