Correlation Between FRONTEO and Edgewater Technology
Can any of the company-specific risk be diversified away by investing in both FRONTEO and Edgewater Technology 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 FRONTEO and Edgewater Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FRONTEO and Edgewater Technology, you can compare the effects of market volatilities on FRONTEO and Edgewater Technology 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 FRONTEO with a short position of Edgewater Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of FRONTEO and Edgewater Technology.
Diversification Opportunities for FRONTEO and Edgewater Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FRONTEO and Edgewater is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FRONTEO and Edgewater Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edgewater Technology and FRONTEO 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 FRONTEO are associated (or correlated) with Edgewater Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edgewater Technology has no effect on the direction of FRONTEO i.e., FRONTEO and Edgewater Technology go up and down completely randomly.
Pair Corralation between FRONTEO and Edgewater Technology
If you would invest (100.00) in Edgewater Technology on February 5, 2024 and sell it today you would earn a total of 100.00 from holding Edgewater Technology or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
FRONTEO vs. Edgewater Technology
Performance |
Timeline |
FRONTEO |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Edgewater Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FRONTEO and Edgewater Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FRONTEO and Edgewater Technology
The main advantage of trading using opposite FRONTEO and Edgewater Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FRONTEO position performs unexpectedly, Edgewater Technology 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 Edgewater Technology will offset losses from the drop in Edgewater Technology's long position.FRONTEO vs. HNI Corp | FRONTEO vs. Eastman Chemical | FRONTEO vs. Merit Medical Systems | FRONTEO vs. Flexible Solutions International |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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