Correlation Between Formula Systems and Concentrix
Can any of the company-specific risk be diversified away by investing in both Formula Systems and Concentrix 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 Formula Systems and Concentrix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Formula Systems 1985 and Concentrix, you can compare the effects of market volatilities on Formula Systems and Concentrix 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 Formula Systems with a short position of Concentrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Formula Systems and Concentrix.
Diversification Opportunities for Formula Systems and Concentrix
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Formula and Concentrix is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Formula Systems 1985 and Concentrix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concentrix and Formula 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 Formula Systems 1985 are associated (or correlated) with Concentrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concentrix has no effect on the direction of Formula Systems i.e., Formula Systems and Concentrix go up and down completely randomly.
Pair Corralation between Formula Systems and Concentrix
Assuming the 90 days horizon Formula Systems 1985 is expected to under-perform the Concentrix. But the stock apears to be less risky and, when comparing its historical volatility, Formula Systems 1985 is 1.31 times less risky than Concentrix. The stock trades about -0.06 of its potential returns per unit of risk. The Concentrix is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,449 in Concentrix on August 28, 2024 and sell it today you would earn a total of 28.00 from holding Concentrix or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Formula Systems 1985 vs. Concentrix
Performance |
| Timeline |
| Formula Systems 1985 |
| Concentrix |
Formula Systems and Concentrix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Formula Systems and Concentrix
The main advantage of trading using opposite Formula Systems and Concentrix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Formula Systems position performs unexpectedly, Concentrix 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 Concentrix will offset losses from the drop in Concentrix's long position.| Formula Systems vs. CSP Inc | Formula Systems vs. Nayax | Formula Systems vs. Information Services Group | Formula Systems vs. The Hackett Group |
| Concentrix vs. Oneconnect Financial Technology | Concentrix vs. Global Business Travel | Concentrix vs. Alight Inc | Concentrix 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |