Correlation Between Exponent and CSG Systems
Can any of the company-specific risk be diversified away by investing in both Exponent and CSG Systems 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 Exponent and CSG Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exponent and CSG Systems International, you can compare the effects of market volatilities on Exponent and CSG Systems 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 Exponent with a short position of CSG Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exponent and CSG Systems.
Diversification Opportunities for Exponent and CSG Systems
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Exponent and CSG is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Exponent and CSG Systems International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSG Systems International and Exponent 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 Exponent are associated (or correlated) with CSG Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSG Systems International has no effect on the direction of Exponent i.e., Exponent and CSG Systems go up and down completely randomly.
Pair Corralation between Exponent and CSG Systems
Given the investment horizon of 90 days Exponent is expected to generate 1.16 times less return on investment than CSG Systems. In addition to that, Exponent is 1.07 times more volatile than CSG Systems International. It trades about 0.01 of its total potential returns per unit of risk. CSG Systems International is currently generating about 0.01 per unit of volatility. If you would invest 5,397 in CSG Systems International on August 30, 2024 and sell it today you would earn a total of 62.00 from holding CSG Systems International or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Exponent vs. CSG Systems International
Performance |
| Timeline |
| Exponent |
| CSG Systems International |
Exponent and CSG Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exponent and CSG Systems
The main advantage of trading using opposite Exponent and CSG Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exponent position performs unexpectedly, CSG Systems 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 CSG Systems will offset losses from the drop in CSG Systems' long position.| Exponent vs. CRA International | Exponent vs. Huron Consulting Group | Exponent vs. Forrester Research | Exponent vs. Resources Connection |
| CSG Systems vs. Oneconnect Financial Technology | CSG Systems vs. Global Business Travel | CSG Systems vs. Alight Inc | CSG Systems vs. CS Disco LLC |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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