Correlation Between Gartner and Fiserv

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

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

Diversification Opportunities for Gartner and Fiserv

0.49

Correlation Coefficient

Gartner  Fiserv

Very weak diversification

The 3 months correlation between Gartner and Fiserv is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Gartner and Fiserv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiserv Inc and Gartner 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 Gartner are associated (or correlated) with Fiserv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiserv Inc has no effect on the direction of Gartner i.e., Gartner and Fiserv go up and down completely randomly.

Pair Corralation between Gartner and Fiserv

If you would invest  49,196  in Gartner on August 30, 2024 and sell it today you would earn a total of  2,727  from holding Gartner or generate 5.54% return on investment over 90 days.

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

Gartner  vs.  Fiserv Inc

Gartner

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gartner are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Gartner is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Fiserv Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Gartner and Fiserv

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

The idea behind Gartner and Fiserv Inc 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.