Correlation Between Cellebrite and Evertec

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

By analyzing existing cross correlation between Cellebrite DI Equity and Evertec, you can compare the effects of market volatilities on Cellebrite and Evertec 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 Cellebrite with a short position of Evertec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cellebrite and Evertec.

Diversification Opportunities for Cellebrite and Evertec

0.79

Correlation Coefficient

Cellebrite  Evertec

Poor diversification

The 3 months correlation between Cellebrite and Evertec is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Cellebrite DI Equity and Evertec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evertec and Cellebrite 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 Cellebrite DI Equity are associated (or correlated) with Evertec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evertec has no effect on the direction of Cellebrite i.e., Cellebrite and Evertec go up and down completely randomly.

Pair Corralation between Cellebrite and Evertec

If you would invest  3,393  in Evertec on September 18, 2024 and sell it today you would earn a total of  121.00  from holding Evertec or generate 3.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.59%
Values	Daily Returns

Cellebrite DI Equity  vs.  Evertec

Cellebrite DI Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cellebrite DI Equity has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Cellebrite is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Evertec

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Evertec are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Evertec is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Cellebrite and Evertec

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

The idea behind Cellebrite DI Equity and Evertec 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.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.