Correlation Between Intermap Technologies and Descartes Systems
Can any of the company-specific risk be diversified away by investing in both Intermap Technologies and Descartes 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 Intermap Technologies and Descartes Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intermap Technologies Corp and Descartes Systems Group, you can compare the effects of market volatilities on Intermap Technologies and Descartes 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 Intermap Technologies with a short position of Descartes Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermap Technologies and Descartes Systems.
Diversification Opportunities for Intermap Technologies and Descartes Systems
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Intermap and Descartes is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Intermap Technologies Corp and Descartes Systems Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Descartes Systems and Intermap 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 Intermap Technologies Corp are associated (or correlated) with Descartes Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Descartes Systems has no effect on the direction of Intermap Technologies i.e., Intermap Technologies and Descartes Systems go up and down completely randomly.
Pair Corralation between Intermap Technologies and Descartes Systems
Assuming the 90 days trading horizon Intermap Technologies Corp is expected to generate 3.51 times more return on investment than Descartes Systems. However, Intermap Technologies is 3.51 times more volatile than Descartes Systems Group. It trades about 0.13 of its potential returns per unit of risk. Descartes Systems Group is currently generating about 0.13 per unit of risk. If you would invest 58.00 in Intermap Technologies Corp on September 14, 2024 and sell it today you would earn a total of 152.00 from holding Intermap Technologies Corp or generate 262.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intermap Technologies Corp vs. Descartes Systems Group
Performance |
| Timeline |
| Intermap Technologies |
| Descartes Systems |
Intermap Technologies and Descartes Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intermap Technologies and Descartes Systems
The main advantage of trading using opposite Intermap Technologies and Descartes Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intermap Technologies position performs unexpectedly, Descartes 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 Descartes Systems will offset losses from the drop in Descartes Systems' long position.| Intermap Technologies vs. Adcore Inc | Intermap Technologies vs. Emerge Commerce | Intermap Technologies vs. Quisitive Technology Solutions | Intermap Technologies vs. DGTL Holdings |
| Descartes Systems vs. Kinaxis | Descartes Systems vs. Enghouse Systems | Descartes Systems vs. Open Text Corp | Descartes Systems vs. Celestica |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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