Correlation Between Evertz Technologies and International Business
Can any of the company-specific risk be diversified away by investing in both Evertz Technologies and International Business 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 Evertz Technologies and International Business into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evertz Technologies Limited and International Business Machines, you can compare the effects of market volatilities on Evertz Technologies and International Business 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 Evertz Technologies with a short position of International Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evertz Technologies and International Business.
Diversification Opportunities for Evertz Technologies and International Business
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Evertz and International is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Evertz Technologies Limited and International Business Machine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Business and Evertz Technologies 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 Evertz Technologies Limited are associated (or correlated) with International Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Business has no effect on the direction of Evertz Technologies i.e., Evertz Technologies and International Business go up and down completely randomly.
Pair Corralation between Evertz Technologies and International Business
Assuming the 90 days horizon Evertz Technologies is expected to generate 2.46 times less return on investment than International Business. In addition to that, Evertz Technologies is 1.62 times more volatile than International Business Machines. It trades about 0.02 of its total potential returns per unit of risk. International Business Machines is currently generating about 0.08 per unit of volatility. If you would invest 2,174 in International Business Machines on September 4, 2024 and sell it today you would earn a total of 1,320 from holding International Business Machines or generate 60.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evertz Technologies Limited vs. International Business Machine
Performance |
| Timeline |
| Evertz Technologies |
| International Business |
Evertz Technologies and International Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evertz Technologies and International Business
The main advantage of trading using opposite Evertz Technologies and International Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evertz Technologies position performs unexpectedly, International Business 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 International Business will offset losses from the drop in International Business' long position.| Evertz Technologies vs. Computer Modelling Group | Evertz Technologies vs. Descartes Systems Group | Evertz Technologies vs. TECSYS Inc | Evertz Technologies vs. Exco Technologies Limited |
| International Business vs. Canlan Ice Sports | International Business vs. DIRTT Environmental Solutions | International Business vs. Champion Iron | International Business vs. Caribbean Utilities |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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