Correlation Between TECSYS and Intermap Technologies
Can any of the company-specific risk be diversified away by investing in both TECSYS and Intermap Technologies 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 TECSYS and Intermap Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TECSYS Inc and Intermap Technologies Corp, you can compare the effects of market volatilities on TECSYS and Intermap Technologies 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 TECSYS with a short position of Intermap Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of TECSYS and Intermap Technologies.
Diversification Opportunities for TECSYS and Intermap Technologies
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TECSYS and Intermap is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding TECSYS Inc and Intermap Technologies Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermap Technologies and TECSYS 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 TECSYS Inc are associated (or correlated) with Intermap Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermap Technologies has no effect on the direction of TECSYS i.e., TECSYS and Intermap Technologies go up and down completely randomly.
Pair Corralation between TECSYS and Intermap Technologies
Assuming the 90 days trading horizon TECSYS is expected to generate 3.52 times less return on investment than Intermap Technologies. But when comparing it to its historical volatility, TECSYS Inc is 2.31 times less risky than Intermap Technologies. It trades about 0.08 of its potential returns per unit of risk. Intermap Technologies Corp is currently generating about 0.13 of returns per unit of risk over similar time horizon. 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TECSYS Inc vs. Intermap Technologies Corp
Performance |
| Timeline |
| TECSYS Inc |
| Intermap Technologies |
TECSYS and Intermap Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TECSYS and Intermap Technologies
The main advantage of trading using opposite TECSYS and Intermap Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TECSYS position performs unexpectedly, Intermap Technologies 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 Intermap Technologies will offset losses from the drop in Intermap Technologies' long position.The idea behind TECSYS Inc and Intermap Technologies Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Intermap Technologies vs. Adcore Inc | Intermap Technologies vs. Emerge Commerce | Intermap Technologies vs. Quisitive Technology Solutions | Intermap Technologies vs. DGTL Holdings |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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