Correlation Between VirnetX Holding and Asure Software

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

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

Diversification Opportunities for VirnetX Holding and Asure Software

-0.4

Correlation Coefficient

VirnetX Holding  Asure Software

Very good diversification

The 3 months correlation between VirnetX and Asure is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding VirnetX Holding Corp and Asure Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asure Software and VirnetX Holding 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 VirnetX Holding Corp are associated (or correlated) with Asure Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asure Software has no effect on the direction of VirnetX Holding i.e., VirnetX Holding and Asure Software go up and down completely randomly.

Pair Corralation between VirnetX Holding and Asure Software

Considering the 90-day investment horizon VirnetX Holding Corp is expected to under-perform the Asure Software. In addition to that, VirnetX Holding is 1.68 times more volatile than Asure Software. It trades about -0.38 of its total potential returns per unit of risk. Asure Software is currently generating about 0.22 per unit of volatility. If you would invest  861.00  in Asure Software on September 17, 2024 and sell it today you would earn a total of  89.00  from holding Asure Software or generate 10.34% return on investment over 90 days.

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

VirnetX Holding Corp  vs.  Asure Software

VirnetX Holding Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VirnetX Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Asure Software

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Asure Software is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with VirnetX Holding and Asure Software

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

The idea behind VirnetX Holding Corp and Asure Software 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.