Correlation Between TECSYS and Savaria
Can any of the company-specific risk be diversified away by investing in both TECSYS and Savaria 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 Savaria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TECSYS Inc and Savaria, you can compare the effects of market volatilities on TECSYS and Savaria 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 Savaria. Check out your portfolio center. Please also check ongoing floating volatility patterns of TECSYS and Savaria.
Diversification Opportunities for TECSYS and Savaria
Good diversification
The 3 months correlation between TECSYS and Savaria is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding TECSYS Inc and Savaria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Savaria 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 Savaria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Savaria has no effect on the direction of TECSYS i.e., TECSYS and Savaria go up and down completely randomly.
Pair Corralation between TECSYS and Savaria
Assuming the 90 days trading horizon TECSYS Inc is expected to generate 1.46 times more return on investment than Savaria. However, TECSYS is 1.46 times more volatile than Savaria. It trades about 0.1 of its potential returns per unit of risk. Savaria is currently generating about 0.09 per unit of risk. If you would invest 3,526 in TECSYS Inc on August 29, 2024 and sell it today you would earn a total of 924.00 from holding TECSYS Inc or generate 26.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TECSYS Inc vs. Savaria
Performance |
| Timeline |
| TECSYS Inc |
| Savaria |
TECSYS and Savaria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TECSYS and Savaria
The main advantage of trading using opposite TECSYS and Savaria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TECSYS position performs unexpectedly, Savaria 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 Savaria will offset losses from the drop in Savaria's long position.| TECSYS vs. Berkshire Hathaway CDR | TECSYS vs. JPMorgan Chase Co | TECSYS vs. Bank of America | TECSYS vs. Alphabet Inc CDR |
| Savaria vs. TFI International | Savaria vs. goeasy | Savaria vs. Enghouse Systems | Savaria vs. Exchange Income |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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