Correlation Between Sangoma Technologies and Adcore

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

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

Diversification Opportunities for Sangoma Technologies and Adcore

-0.16

Correlation Coefficient

Sangoma Technologies  Adcore

Good diversification

The 3 months correlation between Sangoma and Adcore is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sangoma Technologies Corp and Adcore Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adcore Inc and Sangoma Technologies 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 Sangoma Technologies Corp are associated (or correlated) with Adcore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adcore Inc has no effect on the direction of Sangoma Technologies i.e., Sangoma Technologies and Adcore go up and down completely randomly.

Pair Corralation between Sangoma Technologies and Adcore

Assuming the 90 days trading horizon Sangoma Technologies Corp is expected to generate 0.67 times more return on investment than Adcore. However, Sangoma Technologies Corp is 1.5 times less risky than Adcore. It trades about 0.12 of its potential returns per unit of risk. Adcore Inc is currently generating about -0.02 per unit of risk. If you would invest  718.00  in Sangoma Technologies Corp on September 2, 2024 and sell it today you would earn a total of  136.00  from holding Sangoma Technologies Corp or generate 18.94% return on investment over 90 days.

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

Sangoma Technologies Corp  vs.  Adcore Inc

Sangoma Technologies Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sangoma Technologies Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Sangoma Technologies displayed solid returns over the last few months and may actually be approaching a breakup point.

Adcore Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Sangoma Technologies and Adcore

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

The idea behind Sangoma Technologies Corp and Adcore 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.

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 CEOs Directory module to screen CEOs from public companies around the world.