Correlation Between Geospace Technologies and Now
Can any of the company-specific risk be diversified away by investing in both Geospace Technologies and Now 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 Geospace Technologies and Now into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geospace Technologies and Now Inc, you can compare the effects of market volatilities on Geospace Technologies and Now 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 Geospace Technologies with a short position of Now. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geospace Technologies and Now.
Diversification Opportunities for Geospace Technologies and Now
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Geospace and Now is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Geospace Technologies and Now Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Now Inc and Geospace 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 Geospace Technologies are associated (or correlated) with Now. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Now Inc has no effect on the direction of Geospace Technologies i.e., Geospace Technologies and Now go up and down completely randomly.
Pair Corralation between Geospace Technologies and Now
Given the investment horizon of 90 days Geospace Technologies is expected to under-perform the Now. In addition to that, Geospace Technologies is 1.06 times more volatile than Now Inc. It trades about -0.05 of its total potential returns per unit of risk. Now Inc is currently generating about 0.15 per unit of volatility. If you would invest 1,325 in Now Inc on October 20, 2024 and sell it today you would earn a total of 47.00 from holding Now Inc or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geospace Technologies vs. Now Inc
Performance |
| Timeline |
| Geospace Technologies |
| Now Inc |
Geospace Technologies and Now Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geospace Technologies and Now
The main advantage of trading using opposite Geospace Technologies and Now positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geospace Technologies position performs unexpectedly, Now 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 Now will offset losses from the drop in Now's long position.| Geospace Technologies vs. Enerflex | Geospace Technologies vs. Oil States International | Geospace Technologies vs. MRC Global | Geospace Technologies vs. North American Construction |
| Now vs. Oil States International | Now vs. Oceaneering International | Now vs. Geospace Technologies | Now vs. Enerflex |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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