Correlation Between NewtekOne, 800 and Supercom

Can any of the company-specific risk be diversified away by investing in both NewtekOne, 800 and Supercom 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 NewtekOne, 800 and Supercom into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NewtekOne, 800 percent and Supercom, you can compare the effects of market volatilities on NewtekOne, 800 and Supercom 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 NewtekOne, 800 with a short position of Supercom. Check out your portfolio center. Please also check ongoing floating volatility patterns of NewtekOne, 800 and Supercom.

Diversification Opportunities for NewtekOne, 800 and Supercom

-0.1

Correlation Coefficient

NewtekOne, 800  Supercom

Good diversification

The 3 months correlation between NewtekOne, and Supercom is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding NewtekOne, 800 percent and Supercom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supercom and NewtekOne, 800 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 NewtekOne, 800 percent are associated (or correlated) with Supercom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supercom has no effect on the direction of NewtekOne, 800 i.e., NewtekOne, 800 and Supercom go up and down completely randomly.

Pair Corralation between NewtekOne, 800 and Supercom

Assuming the 90 days horizon NewtekOne, 800 is expected to generate 1.28 times less return on investment than Supercom. But when comparing it to its historical volatility, NewtekOne, 800 percent is 5.62 times less risky than Supercom. It trades about 0.03 of its potential returns per unit of risk. Supercom is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  341.00  in Supercom on September 17, 2024 and sell it today you would lose (16.00) from holding Supercom or give up 4.69% of portfolio value over 90 days.

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

NewtekOne, 800 percent  vs.  Supercom

NewtekOne, 800 percent

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NewtekOne, 800 percent are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, NewtekOne, 800 is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Supercom

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Supercom has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Supercom is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with NewtekOne, 800 and Supercom

The main advantage of trading using opposite NewtekOne, 800 and Supercom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NewtekOne, 800 position performs unexpectedly, Supercom 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 Supercom will offset losses from the drop in Supercom's long position.

The idea behind NewtekOne, 800 percent and Supercom 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.