Correlation Between Hub Cyber and Intrusion

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

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

Diversification Opportunities for Hub Cyber and Intrusion

0.41

Correlation Coefficient

Hub Cyber  Intrusion

Very weak diversification

The 3 months correlation between Hub and Intrusion is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Hub Cyber Security and Intrusion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrusion and Hub Cyber 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 Hub Cyber Security are associated (or correlated) with Intrusion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrusion has no effect on the direction of Hub Cyber i.e., Hub Cyber and Intrusion go up and down completely randomly.

Pair Corralation between Hub Cyber and Intrusion

Given the investment horizon of 90 days Hub Cyber Security is expected to generate 1.24 times more return on investment than Intrusion. However, Hub Cyber is 1.24 times more volatile than Intrusion. It trades about -0.01 of its potential returns per unit of risk. Intrusion is currently generating about -0.21 per unit of risk. If you would invest  50.00  in Hub Cyber Security on September 24, 2024 and sell it today you would lose (7.00) from holding Hub Cyber Security or give up 14.0% of portfolio value over 90 days.

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

Hub Cyber Security  vs.  Intrusion

Hub Cyber Security

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hub Cyber Security has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, Hub Cyber is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Intrusion

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intrusion has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Hub Cyber and Intrusion

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

The idea behind Hub Cyber Security and Intrusion 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.