Correlation Between Asure Software and Evertz Technologies

Can any of the company-specific risk be diversified away by investing in both Asure Software and Evertz 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 Asure Software and Evertz Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Asure Software and Evertz Technologies Limited, you can compare the effects of market volatilities on Asure Software and Evertz 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 Asure Software with a short position of Evertz Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Evertz Technologies.

Diversification Opportunities for Asure Software and Evertz Technologies

-0.2

Correlation Coefficient

Asure Software  Evertz Technologies

Good diversification

The 3 months correlation between Asure and Evertz is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Evertz Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evertz Technologies and Asure Software 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 Asure Software are associated (or correlated) with Evertz Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evertz Technologies has no effect on the direction of Asure Software i.e., Asure Software and Evertz Technologies go up and down completely randomly.

Pair Corralation between Asure Software and Evertz Technologies

Given the investment horizon of 90 days Asure Software is expected to generate 7.35 times more return on investment than Evertz Technologies. However, Asure Software is 7.35 times more volatile than Evertz Technologies Limited. It trades about 0.06 of its potential returns per unit of risk. Evertz Technologies Limited is currently generating about 0.07 per unit of risk. If you would invest  870.00  in Asure Software on September 12, 2024 and sell it today you would earn a total of  85.00  from holding Asure Software or generate 9.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Asure Software  vs.  Evertz Technologies Limited

Asure Software

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Asure Software may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Evertz Technologies

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Evertz Technologies Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Evertz Technologies is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Asure Software and Evertz Technologies

The main advantage of trading using opposite Asure Software and Evertz Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, Evertz 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 Evertz Technologies will offset losses from the drop in Evertz Technologies' long position.

The idea behind Asure Software and Evertz Technologies Limited 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.

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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.